Unemployment claims are rising. The spike in initial claims is hurricane related. Cause for alarm or not?
I will tell you upfront, the title is a bit of a tease. The data is an important piece, but stand alone will not answer the question.
So if you answered yes or no to the question without the correct reason, you missed the boat. This data is only half of what’s needed to answer the question. But we need to discuss this data before we get to the second half.
Hurricane Helene Distortions
Reuters reports US weekly jobless claims surge amid Hurricane Helene distortions
The number of Americans filing new applications for unemployment benefits surged last week, partially boosted by Hurricane Helene and furloughs at Boeing (BA.N), opens new tab amid a nearly four-week-old strike at the U.S. planemaker.
Initial claims for state unemployment benefits increased 33,000 last week to a seasonally adjusted 258,000 for the week ended October. 5, the Labor Department said on Thursday.
Economists polled by Reuters had forecast 230,000 claims for the latest week. There were large increases in unadjusted claims in North Carolina and Florida and claims also rose in Washington state. Helene, which tore through Florida and devastated large swathes of the U.S. Southeast in late September, is likely to continue distorting claims data in the weeks ahead.
Fact Check: True
Hurricane Helene greatly exaggerated unemployment claims and hurricane Milton is likely to do the same.
Continued Unemployment Claims
Cause for Alarm?
Continued claims spiked but they are still below a level reached on July 27, 2024.
It’s easy to spin this however you want.
But even without hurricane distortions there is no way of looking at this data in isolation, either weekly or 4-week moving averages that directly answers the question.
The answer is yes, there is a huge cause for alarm. But I am going to do a separate post (my very next one), on the right way to look at claims data.
This background information is needed for my next post. Please stay tuned.
Absolutely not! Zero cause for alarm.
When continued claims move above 2M, then let’s start paying attention. The reality is that when this happens, the Fed will already have cut by at least another 50 BP, and the entire mood around the economy will have started to swing south.
Would not shrug off those Hurricane related job losses.
Amount of damage done will result in permanent job losses.
One area in N. Carolina where there are five silica mines lost their rail system.
Silica mines which produce the quality silica required for making chips.
Since everything is still just in time delivery, not going to be inventory set aside as stockpiles against shortages.
Wouldn’t there be added jobs to rebuild the rail system that was probably in need of modernization any way as well as trucking jobs to get the mined product to processing facilities? Is the silica product is that valuable it will get to market.
Add also the jobs created to rebuild the rest of the roads and homes; but wait, all of the FEMA money has been spent elsewhere🤦♂️!
Expecting a FEMA bailout soon.
Things you post about can get done. Cost factor is another matter.
What was destroyed by flooding took generations to build.
Generational building coming from a much lower base cost.
Without a strong economy creating real wealth rather then an economy based upon government deficit spending and growth of private Debt there is no coming back.
Infrastructure across this country still running upon Roosevelt New deal.
Welfare state has siphoned off what should have been applied to maintenance and rebuild.
Hugely inflationary pressure as consequence.
Going to guess that the next one mentions the relatively low ratio of claims to unemployed people. It looks like low claims levels are not exactly comparable to past periods and overstate labor market health.
Looks like another wiggle in a wiggley line.
Homeland Security Secretary Alejandro Mayorkas spent less than six hours visiting hurricane-hit areas of North Carolina on Thursday — before retreating to Washington to grab an early takeout dinner at Nobu.
What was he gonna do? Run out there and throw people over his shoulder and rescue them? He’s an administrator. He doesn’t do. He figures out what to do.
Always the whining with you people…
Uh huh
Like he did with the border
Apparently you don’t remember Katrina response. That’s ok. Enjoy the election
A disastrous report for the incumbents
what happens when Trump declares all Hatians ILLEGAL and ends their Temporary status
Tyson not going to be able to process beef or chicken
How did we ever get by without Haitians?
You actually believe campaign ‘Ganda?
Show us when it happens