Unemployment Claims Still Cast Doubt On The Jobs Recovery

The worst may be over but the recovery is painfully slow.

No Progress Since October 3

On October 3, initial unemployment claims were 767,000. Since then, initial claims meandered from a November 7 low of 711,000 to a high of 927,000 on January 9. 

I see this as four months of no progress so I question reports like today's WSJ article Winter Layoffs Show Early Signs of Easing

The worst of the pandemic’s effects on the job market appear to have passed, said Aneta Markowska, chief economist at Jefferies LLC. 

Things are really starting to improve again in the labor market,” she said.

The worst was over four months ago. But are things really starting to improve? 

They might, but it is not in the data yet. Here's a curious statement from the article.

“It’s still hard to say how quickly things will bounce back from the winter slowdown, but it does seem like things are trending in the right direction,” said Daniel Zhao, senior economist at job site Glassdoor. December payrolls mainly fell because companies were reluctant to hire workers, not because they were laying them off, he said, referencing a recent Labor Department report.

Payrolls do not fall from lack of hiring. They only fall when more people leave than are hired.

That said, lockdown restrictions are easing as are the number of Covid cases so perhaps we will see some hiring in the hard-hit leisure and hospitality segment, but let's not jump the gun. 

Continued Claims

Continued State Unemployment Claims  2021-02-11 Report

We have seen slow progress in continued unemployment claims but much of this is masked by people expiring all of their state benefits and falling off the roles onto various federal programs.

The federal numbers are so skewed by fraud, reporting errors, and double counting distortions that I stopped posting them.

Powell Says the True Unemployment Rate is Actually 10%

Yesterday I noted that Fed Chair Jerome Powell said the True Unemployment Rate is Actually 10%.

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