1st-time and Continued Unemployment Insurance Both Increase

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • There were 215,000 1st-time claims for unemployment insurance for the week ended Aug 24, 2019, an INCREASE of 4,000 from the previous week’s upwardly revised 211,000 (from 209,000);
  • The four-week moving average of initial claims FELL 500 to 214,500;
  • Four -week moving average represented 0.136 percent of employment, DOWN from 0.137 percent the previous week;
  • The number of continued claims – individuals who had been collecting unemployment insurance — reported on a one-week lag, was 1,698,000 for the week ended August 17, UP 22,000 from the previous week’s upwardly REVISED 1,676,000 (from 1,674,000)
  • The four-week moving average of continued claims FELL 250 to 1,697,250;

Trends:

  • The week-week drop in the four-week moving average of initial claims was the first decline in four weeks;
  • Initial claims for the first eight weeks of this third quarter are up, less than one percent, from the same period in the second quarter.

Data Source: Department of Labor 

Image result for layoffs 2019

Though the numbers haven’t been huge, there’s been a mildly disturbing trend in the weekly report on unemployment insurance claims with a slow but steady increase in the numbers reported each week.

The increases haven’t been large, and indeed the “smoothing” four-week moving average of first-time claims continues to drop but the number of new claimants has been climbing, another signal of a softening economy.

To be sure, the number of first-time claims is far from Great Recession levels but some industry sectors – notably retail – are struggling as suggested by the large numbers of chain store closings.

While job cuts remain relatively low, they have increased. According to the July report of outplacement firm Challenger, Gray and Christmas, July’s total number of layoffs, 38,845, is 43.2% higher than the 27,122 job cuts announced in the same month last year. So far this year, employers have announced plans to cut 369,832 jobs, a 35.8% increase from the 272,301 cuts announced in the first seven months of last year. It is the highest seven-month total since 2015, when 393,368 cuts were announced.

“Manufacturers, the Challenger report said, are being hit, not only by shifting consumer behavior and automation, but by the imposed tariffs. Last month saw over 1,000 cuts announced due to the impact of tariffs,” According to the report, 1,053 pf the July job cuts were due to tariffs, for a total of 1,430 this year.

You can hear Mark Lieberman every Friday at 6:20 am on POTUS’ Morning Briefing, Sirius-XM 124. You can follow him on Twitter at @foxeconomics.

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