After stabilizing for about a year, continued unemployment claims have surged in the last two months.
The Weekly Claims report from the Department of Labor shows that it is increasingly hard to find a new jobs if you are laid off.
Continued Claims Key Points
- The advance number for seasonally adjusted insured unemployment during the week ending July 6 was 1,867,000, an increase of 20,000 from the previous week’s revised level.
- This is the highest level for insured unemployment since November 27, 2021 when it was 1,878,000. The previous week’s level was revised down by 5,000 from 1,852,000 to 1,847,000.
- The 4-week moving average was 1,850,500, an increase of 11,500 from the previous week’s revised average.
- This is the highest level for this average since December 4, 2021 when it was 1,859,750. The previous week’s average was revised down by 1,250 from 1,840,250 to 1,839,000.
Initial Unemployment Claims
Initial Claims Key Points
- In the week ending July 13, the advance figure for seasonally adjusted initial claims was 243,000, an increase of 20,000 from the previous week’s revised level.
- The previous week’s level was revised up by 1,000 from 222,000 to 223,000.
- The 4-week moving average was 234,750, an increase of 1,000 from the previous week’s revised average.
- The previous week’s average was revised up by 250 from 233,500 to 233,750.
Continued Claims Long Term
It’s not the level that indicates a problem, it’s a sustained uptrend from recent lows that’s highlights trouble.
Note that 5 out of 12 Fed Districts Show Flat or Declining Economic Growth
The Fed’s Beige Book solidifies the recession view.
Recession When?
I think a recession started in May or June and I have seen little to change my mind.
For discussion, please see Weak Data Says a Recession Has Already Started, Let’s Now Discuss When
Add continued claims to the trend of weakness appearing nearly everywhere.
“Recession When?
I think a recession started in May or June and I have seen little to change my mind.”
Mark me down, the recession has started. Using the company I work for as a proxy which suddenly started progressing as it did in 2008 tells me the recession has started.
I would have to believe that other companys are in the same boat and expect them to begin cost reductions.
U-3 would have to go above 5% for a recession imo. Privately I know the Fed has told people it is willing to live with unemployment between 5-6 %. I don’t think any president can live with this and survive.
Prepare for tariffs and rising prices if Trump/Vance get in.
as opposed to tariffs and inflation with your candidate? and your multiple full time jobs in tech, i’ll ask, do they really work both full time jobs or are they doing what many coworkers did during covid which is to collect the remote paycheck but not put in 40 hours a week?
Unemployment is a lagging indicator. Is does not cause a recession, but is the result of one.
I know people in tech that have multiple full time jobs. They are effectively taking away opportunities that might go to someone who is unemployed in tech. This likely goes on in other industries as well since covid allowed people to work remotely.
I have noted over the years a vast difference between very productive tech workers and tech workers that should be in another line of work but remain.
100 to 1, or more, even between the good and the best; for fundamentally harder stuff at the core of most larger “systems”. All the way to, perhaps, 100 billion to 1 at the level of work Goedel, Einstein and other “once every ten generations” type brains were futzing with..
Which renders The Fed and Junta’s transferring near ALL wealth, hence all hiring decisions, to “made money” from my “home” and potfoijo” and “Ipee” nobodies, well below the level of the “good” as per above, even more tragic. Even Google has long since given up on anything but cookie cutter and mythical man month fallacies by now. And they actually tried for awhile.
Upside is: Far and away most jobs are at the very opposite end: Almost all complexity is situated at the specifics of one particular job. Such that the best in the world at that job, is simply the one who has done it for awhile.
Which has the salient effect that in a free market and society; wage differences wouldn’t be all that big. And wealth differences hard to sustain. 98% of all work which needs doing, is simply not sufficiently generic, to allow for huge earning power differentials between people.
“They are effectively taking away”
Zero sum economic fallacy. This is the same fallacious argument that boomers need to retire because they are keeping the young out of higher paying jobs.
Economies don’t work this way. More work = higher income = higher consumption = more jobs. Less work = less income = France.
The same arguments have been put forward since the agricultural revolution. John Deere didn’t make us poorer.
It’s been pointed out many times on this blog people have multiple part time jobs. If a person is let go from one job, they most likely will not qualify for unemployment due to the number of hours worked on the other job. The implication of an increasing unemployment number is people are losing TWO jobs and can’t find another.
I don’t think that our leaders understand yet, that increases in debt come with real interest payments. But I am probably wrong and they know that Powell will print, and then print more.
Powell is sending a clear message about debt and interest rates if you heard his last talk. I see no end to the growing debt. Eventually the US will pay with a higher cost of living and less valuable currency.
Eventually it will end with folks only buying US bonds with a one day maturity so they can be dumped before they depreciate.
.
Based on the long-term graph, I’d want to see the current continued claims cross 1,900,000 or 1,950,000 before I’d cry “fire”. But the current uptrend is definitely of concern. If the uptrend continues (or accelerates) it looks like the 1.95M threshold is at most 8-10 weeks out (or less).
All the “loan forgiveness” BS has been cancelled by the courts, retroactively. *Now* there will be a recession, but well worth it.
Biden doesn’t want to quit because then he won’t get unemployment.
Cont unemployment claims and renters turnover are up. The waiting list is down.
The fake positively biased CPI should be down. When the unemployment checks stop home prices will drop.
This strongly suggests that U3 will increase again in July, my guess being 4.2%. Even if the debate hadn’t been a debacle, and there hadn’t been an attempt on Trump’s life, Biden would be in trouble.
U3 was 3.8% in March and has risen by 0.1% in each month since then. The post-WW2 history is that the incumbent party’s candidate loses when that happens. The only exception was 1956, when U3 was trendless that year, the Q2 increase was slight (only 0.1% for the entire quarter), and everything else was strong.
To the extent that running mates count (not much), Vance will prove to be a good pick, because he will be an effective voice of the shit-on working class. Trump’s political instincts have been underrated, including by me.
The next president is going to be trapped in Bermuda triangle of debt, interest rates and inflation. You cannot get growth without inflation in the modern global economy. Americans are addicted to low rates of the 2000s and 2010s.
I’m getting McAfee pop-ups again on this site.
Me too, but with a new wrinkle, the page does not cover the tool bar, so I was able to back page to the Mish page.
If consumers were flush with cash an uptick in unemployment claims or continued claims would show weakness but not trigger alarms.
However the average consumer is not flush with cash but flush with debt. All caution has been thrown away as spend spend spend has gotten backed by full faith and credit
of uncle Sammy.
As the ability to earn and sustain lifestyle choices gets hampered by lessening job opportunity that Brick wall of too much bill at the end of month vs. funds to service those bills is going to be hit. Consumers will have to curtail expectations and this process will accelerate quickly causing demand to fall sharply.
There is no cushion in the economy and even buy now pay later is not a free ride but has more of a lagging indicator quality. Something akin to the green traffic light turning yellow.
Buy now pay later is a baby step away from payday lending. To the extent that it’s genuinely popular, it’s absolutely a yellow light.
Buy now.
Sell now.
Pay later.
Skip town.
Oh bull. Consumer balance sheets have been squeaky clean since the Great Recession clean out. You might be able to point to cohorts, but the average? Come on.
And before someone chimes in on the savings rate, we know what causes that to go up. Distress. Recession. Low savings rate is a function of a healthy economy, not reverse.
The govts balance sheet is horrendous, and the consumer will have to pay for that eventually if not already. Low savings rate is foolish. What does a person do when hard times eventually come if they have no savings?
The blip in the initial claims number is due to counting claims that should have been counted during the July 4 holiday. Business as usual, sideways movement. Historical low level in continuing claims, as the article points out.