Spoiler: New claims are getting close to the 500k mark, but it’s never enough. This week’s Unemployment Insurance Weekly Claims Report has been released. Initial claims fell to 514,000. This landed squarely inside the Bloomberg estimates (500k to 530k). Last week’s number was revised up 3,000 to 524k. From the report:

In the week ending Oct. 10, the advance figure for seasonally adjusted initial claims was 514,000, a decrease of 10,000 from the previous week’s revised figure of 524,000. The 4-week moving average was 531,500, a decrease of 9,000 from the previous week’s revised average of 540,500.

The advance seasonally adjusted insured unemployment rate was 4.5 percent for the week ending Oct. 3, a decrease of 0.1 percentage point from the prior week’s revised rate of 4.6 percent.

The advance number for seasonally adjusted insured unemployment during the week ending Oct. 3 was 5,992,000, a decrease of 75,000 from the preceding week’s revised level of 6,067,000. The 4-week moving average was 6,082,750, a decrease of 68,250 from the preceding week’s revised average of 6,151,000.

I mentioned last week that I was moving my celebration point down to 400k. The official loss of almost a million jobs due to a bookkeeping error is quite serious. To reiterate: the jobs were already gone, they just weren’t accounted for by the DoL. There’s a reasonable chance we’ll get there, though. Look at the new claims graph from the Fed, you’ll see two things of note. First, new claims are clearly trending down. Second, aside from a fairly anomalous spike down in January (followed by a massive spike up), new claims are at their best levels of the year. It’s clear that we’ve got a ways to go before getting back to normal, but we’re moving in the right direction.

A lower new claims number is only the first part of the problem. The second part is new jobs (the monthly statistic). Until there’s a source of hiring, the decrease in continuing claims should be feared as it is most indicative of expiring benefits. Bad news on that front this week. Tuesday marked the second time in two weeks that the unemployment benefits extension bill was shot down on the floor of the Senate.

If there wasn’t enough to be gloomy about, the unadjusted numbers are moving in the wrong direction. Remember, if you are analyzing trends, you should use the seasonally adjusted numbers (caveat, it’s not clear what the continuing claims adjustment is accounting for). If you want to know the strain on the benefits program and the number of people actually worried about that extension bill, you should look at the unadjusted numbers:

The advance number of actual initial claims under state programs, unadjusted, totaled 503,973 in the week ending Oct. 10, an increase of 51,919 from the previous week. There were 454,065 initial claims in the comparable week in 2008.

The advance unadjusted insured unemployment rate was 3.7 percent during the week ending Oct. 3, a decrease of 0.1 percentage point from the prior week. The advance unadjusted number for persons claiming UI benefits in state programs totaled 4,919,556, a decrease of 97,504 from the preceding week. A year earlier, the rate was 2.3 percent and the volume was 3,073,515.

Not much of a story there. Not much good news coming out of the good / bad lists.

The good list (-1000 or more): FL, CA

The bad list (+1000 or more): MI, NY, TX, MO, WI, WA, PA

PA (the worst) was +3,618 vs FL (the best) at -5,178. Construction dominates the comment column in both lists.

The most important news for the short term is still the fate of the unemployment benefits extension bill. There’s still a high probability the bill will pass, it’s just going to be later rather than sooner (next week is still possible). In the medium term, the new claims number should drop to a manageable level. The longer term picture, however, is still dependent upon an engine for jobs growth that has yet to materialize.

-By crazynutjob.

Read all of crazynutjob’s unemployment report recaps here.