Department of Labor Data and BLS long-term unemployment numbers point to a rapidly weakening labor market.
The lead chart shows the monthly average of Continued Claims from the Department of Labor and those unemployed 27 weeks or longer from the BLS.
Initial Claims
- In the week ending December 7, the advance figure for seasonally adjusted initial claims was 242,000, an increase of 17,000 from the previous week’s revised level.
- The previous week’s level was revised up by 1,000 from 224,000 to 225,000. The 4-week moving average was 224,250, an increase of 5,750 from the previous week’s revised average. The previous week’s average was revised up by 250 from 218,250 to 218,500.
Continued Claims
- The advance number for seasonally adjusted insured unemployment during the week ending November 30 was 1,886,000, an increase of 15,000 from the previous week’s unrevised level of 1,871,000.
- The 4-week moving average was 1,888,000, an increase of 3,500 from the previous week’s revised average.
- This is the highest level for this average since November 27, 2021 when it was 1,928,000. The previous week’s average was revised up by 250 from 1,884,250 to 1,884,500.
Insured Unemployment
The key phrase above is “insured unemployment”.
After someone expires all of their unemployment benefits they become “uninsured unemployment” and the Department of Labor stops tracking.
Expiring Unemployment Benefits
- Most states offer 26 weeks of unemployment benefits.
- Many states with a maximum of 26 weeks use a sliding scale based on a worker’s earnings history to determine the maximum number of weeks they qualify
- Arkansas, Iowa, Oklahoma, South Carolina, Missouri, North Carolina, and Kentucky have a lower number of week.
- Massachusetts allows up to 30 weeks depending on conditions. Montana allows 28 weeks of benefits.
Insured unemployment generally ends at 26 weeks. To correct for expiring benefits, we need add those with expired benefits to the number of continuing claims.
Continued Claims and 27+ Weeks Unemployed Detail
Quarterly QCEW Data Provides More Evidence of BLS Jobs Overstatement
On November 20, I commented Quarterly QCEW Data Provides More Evidence of BLS Jobs Overstatement
My prior comparisons and advance calls suggest we see negative revisions in nonfarm payrolls from 2023 Q2 to 2024 Q2 of well over one million. My initial stab is about 1.2 million to the downside.
The BLS Birth-Death model is seriously messed up an/or the BLS is oversampling large corporations and under sampling small businesses.
The BLS monthly nonfarm payroll reports are consistent garbage.
Reflections on BEA Revisions
If jobs are overstated, income is too. And on Wednesday we found out the BEA overstated wages by a massive $91.8 billion from $156.8 billion to $65.0 billion.
Please note the Huge Negative Revision of $91.8 billion to Second-Quarter Private Wages
The BEA commented “With the incorporation of these new QCEW data, real gross domestic income is now estimated to have increased 2.0 percent in the second quarter, a downward revision of 1.4 percentage points from the previously published 3.4 percent estimate.”
I commented “The BEA hugely revised GDI to the downside. Hmm. It seems that voters weren’t fooled.”
Click on the above link for more details and charts.
Small Business Employment in Pictures
Finally, please consider The 2024 Destruction of Small Business Employment in Pictures
Small businesses with employees 1-49 are struggling in 2024. Large businesses are booming [but for how long]?
Inflationary or Recessionary?
There are a huge number of factors in play depending on what Trump does with tariffs, what Trump does with deportations, how much inflation the Fed is willing to tolerate, and how much the Fed reacts to Trump’s jawboning.
Tariffs and deportations are simultaneously inflationary and recessionary depending on the time frame and how fast Trump does or doesn’t do what he has pledged to do.
Neither Trump nor the Fed is in a good position, especially with Stubborn CPI Data.
Why do no analysts take into account the huge numbers of vaccine injured who are forced to quit their jobs creating openings…. when compiling these stats?
Because they are a figment of your fevered imagination.
Are you denying that there are a number of Americans who were injured by the Covid vaccines OR are you disagreeing w/the idea that “huge numbers” were injured?
Lots of people think this is looney talk. Ask my neighbor about. He barely made it.
Labor is giving a huge recession signal. The bounce off the 2022 lows in continued unemployment claims is just as large other bounces prior to recessions. The major difference is present continued unemployment claims has taken longer post bottom to have a recession called. The unemployment spike due to COVID forced some marginal companies to make the decision to shutter permanently sooner than later.
Delaware poised to join the 8 other states that adopted UCC Article 12 https://www.dlapiper.com/en-us/insights/publications/2023/07/delaware-poised-to-join-the-8-other-states-that-adopted-ucc-article-12
Mish
In your earlier post on the recent CPI report you said “According to CME Fedwatch, there is an 85.8 percent chance of a quarter-point cut at the December 18 Fed meeting.
However, there does not seem to much of a reason to cut rates and even less of one if one believes CPI estimates.”
This current post of yours and some earlier posts that show for example more multi family housing projects are completing compared to new starts provide ample reasons to continue gradually reducing rates. Need to look at all the data out there, the monthly inflation data are pretty noisy and not adequate on their own to support policy decisions.
The Federal Reserve is caught between the rock of resurgent inflation and the hard place of increasing unemployment.
The Federal Government is equally caught between the rock of inexorably rising interest payments and the hard place of deficit reduction.
There are no top-level “easy” policy solutions, it’s time for people to open up their minds and roll up their sleeves.
You forgot the 3rd rock: rising interest expense.
Good points though.
LOL – Read the second paragraph again, grasshopper…
Our long national nightmare is ending soon
Trump rang the bell this morning at NYSE. Cramer asked him if it was a great time to buy stocks and to my surprise, Trump waffled and said something about stocks dipping 5:30 mark….that’s saying something from Mr. Bragadocious.
https://www.youtube.com/watch?v=_8d-2QVdtag
He also warns about needing double the electricity over the next few years…
got electric inflation?
Was probably just brainspew if the last few things he saw on tv conflated with the last thing Elon told him that he didn’t understand.
When he rolls out gun control, It’s going to be interesting to watch.
“Take the guns first, go through due process second,” Trump said.
Those 3.5 million desperate souls will be joined by all the govies Elon wants to fire, and should be in pretty dire straits by the time Gun Grabbin’ Day rolls around. Maybe they’ll all just go in the camps?
Everyone’s gotta remember that Trump gets a charge out of shocking everyone.
Puns intended
Trump Backtracks On Campaign Pledge To Bring Down Grocery Prices (EXPECT A LOT MORE BACKTRACKING!!)
His speech prior to ringing the market bell this morning, he brought up grocery prices using a lady buying apples as an example saying he would make groceries affordable again. I doubt groceries go down in price but throttling the rate of increase would be welcome.
he literally promised to cut grocery prices in half in one year . Cant wait to see if he keeps his word.
Just go to Aldi
No Aldi anywhere near here.
Then drive there, and you’ll still save a lot of money.
What if one doesn’t have a car which is a necessity like having two working legs in this day and age?
Someone needs to make a Bullshit Bingo card for the broken promises.
We’ve also got the Ukraine war ended on Jan 20 (I’ll give him till Jan 21 because of the inauguration.
Anybody care to take the other side of my bet on that? No?
Didn’t think so.
And how do you expect he would accomplish this? By a Trumpain edict of some kind? BY threats to food manufacturers or sellers?
Maga magic! Poof! All our wildest dreams are realized!
Farming is very energy dependent, incentives or even just removing the impedance to domestic production and pipelines from producing fields including in Canada to our processing facilities would help with equipment fuel and fertilizer costs. Tariffs levied by countries retaliating to our tariffs and importing our excess harvest could also help by keeping supply elevated at home. I agree that bringing food costs down would be difficult, that’s why I said throttling the increase. This also applies to all agriculture, to include some big economic contributors like forest products to include their chemicals, lumber and paper plus feed stocks for gasoline additives.
Trump also promised to cut energy prices in half. Which is very difficult.
25% of the oil we refine in the US comes from Canada. Producing more shale oil in the USA doesn’t help us because our refineries can’t even handle it; so we export our shale oil.
It will be hard to reduce US energy prices if Trump puts a 25% tariff on Canadian oil.
And now the Canadians are talking about pre-emptive taxes on oil exports to the US in response to Trump’s tariff threats. One of their provincial premiers even talked about cutting off all energy exports to the US if Trump imposes tariffs on Canada.
I have my popcorn ready and am watching this all with great interest!
That would ruin the oil companies. They need maybe 50 dollars a barrel to make money.
Of course. Which is why it is a difficult promise to achieve. New shale wells need $60+.
It’s like telling the auto manufacturers to produce twice as many cars, even though there is no demand for them. No company is willing to do that without some kind of massive subsidy.
Perhaps if the automakers produced electric cars?
Like Tesla? Perhaps Musk will let GM and Ford make Tesla robo-taxis. How many do you want them to make?
Just enough, Papa.
More than enough might be wasteful.
Yes. If you make “enough” of them and replace “enough” ICE vehicles, then demand for gasoline could drop “enough” to lower gas prices.
Thanks Papa, I could not possibly have said it more clearly myself.
I heard about the Ontario premier this morning. This could idle the Illinois refineries? And the big one in Whiting.
Lol… there’s gonna be a lot of angry denial.