- The no. of initial unemployment insurance claims last week: 573,000 (up 58,000 from last week)
- The no. of continuing insurance claims: 4,429,000 (up 338,000 from last week)
- The insured employment rate: 3.3 percent (up 0.2 percentage point)
The headlines are ugly this morning, reporting that initial jobless claims are the highest since November 27, 1982, when 612,000 initial claims were filed.
It's worth noting that our workforce has expanded considerably since then. That week 26 years ago, the insured employment rate (the percentage of workers eligible for unemployment insurance who are collecting benefits) was 5.1 percent. The rate last week was 3.3 percent. While that's now higher than the numbers we saw in the 2001 recession (the highest the insured unemployment rate went was 3.0 in 2003), it's on par with the highs seen in 1991, and still a lower rate than was recorded through much of the 1970s and the early 1980s.
Still, Morgan Stanley economist Ted Wieseman notes that the rate has risen sharply in the last couple of weeks. "We've gone up 3/10ths in two weeks, that's a pretty humongous increase for the typical volatility you see in this series. You get weeks at a time where this thing doesn't move at all."
The real stunner was the 338,000 increase in continuing claims. Other than one week in 1974, we've never come close to a weekly increase of that magnitude, Wieseman says.
So what does all this mean for upcoming unemployment numbers? Wieseman says November's report (533,000 jobs lost) won't likely be repeated. But he thinks we're on pace for a job loss of at least 400,000 in December--and losses of 350,00 to 400,000 continuing for the next six months--then some moderating.
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