Weekly Jobless Claims Fall to 3.5 Year Low
CARPE DIEM
Professor Mark J. Perry's Blog for Economics and Finance
Thursday, December 15, 2011
About Me
- Name: Mark J. Perry
- Location: Washington, D.C., United States
Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
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20 Comments:
JOBLESS RATES DROP TO LOWEST IN OVER 3 YEARS, LONG TERM UNEMPLOYMENT STILL RISING.
What is being ignored is the low and falling participation rate. Having individuals give up looking for jobs is not exactly a good thing.
Just an observation here, but it seems to me they make great hoopla about these initial numbers, then very quietly, and quite frequently, revise them upward later. I'll wait to see the revised numbers.
Blechh.. I find the labor participation rate and to a lesser degree the consumer confidence figures to be much more "authentic" indicators. They're not sexy but they're much more honest. And they are quite frankly awful and getting worse.
An inconvenient stat for the perma bull:
"Total claiming benefits" jumped a full million up to 7.449 million from 6.574 million from last week - and an average of 6.77 million the last 10 weeks.
Also, my reconstructed U7b unemployment rate (public before John Williams one) which includes all 'discouraged workers' that are analogous to the participation rate is still in the 23% range.
Another "inconvenient" fact.
http://www.nowandfutures.com
Question: How accurate are the "seasonal" adjustments? I ask because the last 2-3 years, the hiring up-take has appeared to be a bit low this time of year, and this year it's a bit higher than I can recall it being in quite some time.
If I'm right (certainly arguable, as this is completely anecdotal) and the hiring numbers are significantly higher this season than the last few seasons, I would think that would have a serious effect on the these numbers.
Of course, if I'm right, then there will be larger than expected losses in January/February numbers.
The chart in this post shows number of people not in the labor force.
http://disciplinedinvesting.blogspot.com/2011/12/fragile-employment-market.html
I find the labor participation rate and to a lesser degree the consumer confidence figures to be much more "authentic" indicators.
Agreed. Lower layoffs + lower hiring makes the picture a lot worse than what the U3 numbers portray.
Congress doesn't have to do anything if they want to reduce the unemployment rate:
Federal support for extended unemployment benefits for more than 2 million Americans will expire on Dec. 31 if Congress does not act.
VangeIV: "Having individuals give up looking for jobs is not exactly a good thing."
If "give up looking" means they don't get to collect unemployment benefits, it's a good thing for those of us who pay taxes.
If "give up looking" means they don't get to collect unemployment benefits, it's a good thing for those of us who pay taxes.
Usually when they give up the taxpayer winds up paying again. That is the way that social democracies work.
"Usually when they give up the taxpayer winds up paying again."
How? Food stamps?
"Usually when they give up the taxpayer winds up paying again."
How? Food stamps?
That is one way. Then there are housing subsidies, free health care, etc. As long as government is using its taxation power to fund transfer schemes the taxpayer will be on the hook as many find it easier (over the short term) to stay on welfare programs rather than work.
"many find it easier (over the short term) to stay on welfare programs rather than work."
I'm sure the laws vary from state to state. But I thought in most states that able-bodied persons were required to seek work in order to receive welfare and subsidized housing. That doesn't mean they have to search diligently. But even going through the motions should propel them into the category of "Actively seeking work".
If I am correct about the welfare laws, then I think the majority of those not seeking work are living in households which have at least one wage-earner or source of income. A 60 year old woman married to a social security recipient can easily be "Not seeking work" without requiring welfare. So can any unemployed person married to someone who is working.
If I am correct about the welfare laws, then I think the majority of those not seeking work are living in households which have at least one wage-earner or source of income. A 60 year old woman married to a social security recipient can easily be "Not seeking work" without requiring welfare. So can any unemployed person married to someone who is working.
I believe that an army of paid social workers and activists have made it very easy for people to get support without doing much in the way of seeking work. One way is the medical route. An individual can claim that they are incapable of working and ask for disability payments. Many who are close to retirement can use these payments as a bridge until they are eligible for SS. Fraud is rampant and hundreds of millions are lost each quarter to people who know how to game the system.
Your graph and data would be more effective if you made it "initial claims" on both the graph title and in the body.
As long as government is using its taxation power to fund transfer schemes the taxpayer will be on the hook as many find it easier (over the short term) to stay on welfare programs rather than work.
Then business should be more competitive in compensation regarding those programs. They're asking people to be more competitive for business, what is wrong with a quid pro quo by making it work in both directions(as opposed to just favoring business)?
Then business should be more competitive in compensation regarding those programs. They're asking people to be more competitive for business, what is wrong with a quid pro quo by making it work in both directions(as opposed to just favoring business)?
I think that you are confused. Businesses cannot use force to get people to work for them. They compete for labour in a marketplace in which consumers ultimately decide the 'fair' price as they reward those businesses who are capable of meeting their needs at a cost that is acceptable and punish those that are either not good enough or not cheap enough.
On the other hand, government can and does use force to get the funding it needs for its transfer programs. There is nothing productive about anything that government does.
Well I don't know just how valid the jobless claims are when the so called big picture is looked at...
From the Heritage Foundation there is the following: The 2010 Index of Dependence on Government
Abstract: The number of Americans who pay taxes continues to shrink—and the United States is close to the point at which half of the population will not pay taxes for government benefits they receive. In 2009, 64.3 million Americans depended on the government (read: their fellow citizens) for their daily housing, food, and health care...
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