It's been awhile since I featured this pair of charts above showing: a) the number of jobless claims vs. the size of the U.S. labor force (top chart), and b) jobless claims as a share of the labor force (bottom chart), both updated through February (BLS data here and here).
The top chart shows why unadjusted jobless claims are meaningless: the size of the U.S. labor force has almost doubled over the last 42 years, from 77.57 million in 1968 to the current level of more than 153 million. The bottom chart shows jobless claims adjusted for the size of the U.S. labor force. Jobless claims averaged 406,250 in February, which is 0.2651% of the February labor force of 153,246,000, and is a 2-1/2 year low (lowest since July 2008). Jobless claims as a percent of the labor force have declined the last 6 months in a row, and in 10 out of the last 12 months. Since the peak of 0.415% in March of 2009, adjusted claims have fallen consistently to the current level of 0.265%,
This measure of initial jobless claims, adjusted for the increasing size of the U.S. labor force over time, shows that jobless claims peaked during this recession above the levels of the last two recessions (1990-1991 and 2001), but were never anywhere close to the levels of the previous three recessions in the mid-1970s and early 1980s, and about the same as the 1969-1970 recession. The sharp reduction in adjusted jobless claims from the March 2009 high of 0.415% follows the same pattern of sharp reductions at the end of each of the last six recessions.
Bottom Line: Adjusted jobless claims in recent months are at about the exact same levels as during the last two post-recession expansions in 1992-1993 and 2002-2003 (see red line in the bottom graph), and suggest that conditions in the labor market are actually better than the unadjusted number would suggest. See Scott Grannis' post today for a similar analysis.