That old blog standard – jobless claims

It’s Thursday…it must be time for the weekly initial jobless claims report.  Et voila.

The Department of Labor today reported that initial jobless claims fell by 5,000 last week to a total of 457,000.  Meanwhile, the four-week average also went down by 4,250 to 471,250.  However, jobless claims lasting more than a week increased by 12,000 to a total of 4,579,000.

Analysis: Despite the fact that the Federal Reserve and many institutional forecasters have become comfortable with the labor situation in the U.S., the fact is that the labor market continues to tread water at deep-recessionary levels.  What are these people in power smoking?  For me, the most important fact in the data this week is that the claims lasting more than a week increased by 12,000.  That figure indicates that the job market is souring, and not improving.  It’s like this: we have 5,000 fewer people this week who lost their job a week ago that found work within one week; offset by 12,000 more people this week who lost their job more than a week ago still looking for a job.  Which figure seems more important to you?  Exactly!

I would be very, very, very surprised if there is a huge improvement in consumer confidence, and hence consumer spending this month.  We are half way through the month and the jobs data just do not support a big rise in consumer confidence.  Though one of the mitigating factors is that the Obama Administration, as I predicted, is starting to become Populist again and is now talking about improving the unemployment rate.

Importance grade: 9; this week I am upping the importance grade because of that 12,000 person increase in folks who have been unemployed for longer than a week who are still looking for work.

Jason