Jobless Claims Fall -103,500 in 4 Months; It's Looking A Lot Like The End of a Recession
WASHINGTON/WSJ -- The number of U.S. workers filing new claims for state jobless benefits fell last week, providing another glimmer of hope that the economy may be on the road to recovery. Initial claims for jobless benefits fell by 38,000 to 550,000 on a seasonally adjusted basis in the week ended Aug. 1, the Labor Department said in its weekly report Thursday. The four-week average of new claims, which aims to smooth volatility in the data, fell by 4,750 to 555,250, the lowest level since Jan. 24 (see top chart above).
MP: The bottom chart above shows the drop of -94,000 jobless claims (4-week moving average) in the six month period between October 2001 and March 2002 that signalled the end of the last recession. Compare that drop in jobless claims in 2001 to the -103,500 decline over the last four months and it's sure looking a lot like the end of the current recession.
MP: The bottom chart above shows the drop of -94,000 jobless claims (4-week moving average) in the six month period between October 2001 and March 2002 that signalled the end of the last recession. Compare that drop in jobless claims in 2001 to the -103,500 decline over the last four months and it's sure looking a lot like the end of the current recession.
Originally posted at Carpe Diem.
14 Comments:
Sorry, Mark, but when nearly 140,000 people are rolled off the unemployment line into 'extended benefits' in order to artificially lower the unemployment rate then things are actually much worse than people are saying...
Mark,no state had an increase of greater than 1000...do you know
when the last time that happened?
Continuing unemployment was up a seasonally adjusted 69,000 and this ignores the 140,000 who rolled off continuing unemployment into extended benefits. We're also seeing people now roll off extended benefits as their time runs out. Purchasing power going forward won't exist if people don't have jobs and currently 25% of the population is working less than they want........
these jobless claims numbers are
going to get demonstrably better..
with no states reporting higher jobless claims than 1000...we havent seen this in a july or August since 2007...before the recession...
this is such BS. This is NOT a good sign.
Lets take this scenario -
A restaurant chain has 500 stores. They close 300 stores one month (now they only have 200 stores).
The next month they go out of business and close 200 stores because these are also failing.
Who in their right mind would say that this is a good sign and the company is turning around and growing. They are out of business. The fact that they only closed 200 stores instead of 300 the first month does not show progress that the store closings were 50% less than the first month. It shows they were still screwed the second month.
where are the customers of the 500
stores doing now with their money....
Anonymous,
You don't understand what jobless claims are. And I don't really feel like explaining it to you.
What a bunch of economic imbeciles we have here. Anonymous' point about a company closing stores wasn't about the dynamics of that industry, the state of the economy, or substitute spending. He was giving a simple example of why a declining rate of decline is not necessarily a sign of improvement.
For a fixed scale of firm, there is diminishing marginal returns to labor, other inputs fixed. So increasing production takes ever increasing amounts of labor. The reverse is true. As a company reduces quantity produced, it releases ever smaller quantities of labor until it reaches the shutdown point which results in a mass layoff.
Anonymous' example referred to closing stores, i.e. Reducing capital which is a long run phenomenon. The impact on the decline on labor depends upon the firm's returns to scale, but his example is within the realm of reality, unlike the irrational spinning of continuing bad news into something wonderful.
Never let a macroeconomist teach you microeconomics. It's like letting a Philosophy professor teach English.
hey anonymous did you know that
when there were people filing
jobless claims around 350000,there
were 200000 net jobs being created,
a jobless claim doen't mean there aren't any jobs being created.
apples and oranges....either way I
am making money off of the pessimists
so...keep up the good work...
A decrease of 4750 on a base of 560,000 isn't even statistically different from no change.
There was a 3.7% increase in people claimin Emergency Unemploment Compensation.
The question isn't whether new claims are declining. The correct question is how long will it take to get all these jobs back.
Another second derivative subscriber. This is like a boxer who after getting nearly killed in round 1, is now only getting severely beaten in round 2, but the annoucers are telling you he's starting to win the fight.
Seriously, all this means is that the mayhem portion of the recession is probably behind us.
Anon 11:22a,
Actually, it's more akin to the following: we're driving off a cliff, and we're accelerating, but we're not accelerating as fast as we were last month.
@Brodero
The customers of the 500 stores don't have the money to spend. That is the point idiot - they are unemployed.
It's Looking A Lot Like The End of a Recession"...
O.K. cool then how to explain the following?
From Forbes (via Drudge): US food stamp list tops 34 million for first time
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