This week’s Unemployment Insurance Weekly Claims Report did not give us the three-in-a-row we were looking for. New claims grew to 464k. Last week’s number was actually revised down 2k, which may be the best news in the report. The new claims number fell into the middle of the Bloomberg consensus range of 430k to 490k. From the report:

In the week ending July 17, the advance figure for seasonally adjusted initial claims was 464,000, an increase of 37,000 from the previous week’s revised figure of 427,000. The 4-week moving average was 456,000, an increase of 1,250 from the previous week’s revised average of 454,750.

The advance seasonally adjusted insured unemployment rate was 3.5 percent for the week ending July 10, a decrease of 0.2 percentage point from the prior week’s unrevised rate of 3.7 percent.

The advance number for seasonally adjusted insured unemployment during the week ending July 10 was 4,487,000, a decrease of 223,000 from the preceding week’s revised level of 4,710,000. The 4-week moving average was 4,567,000, a decrease of 21,500 from the preceding week’s revised average of 4,588,500.

Last week’s seasonal data was likely impacted by the decision of some of the automakers to continue production longer than usual. The Labor Department issued a statement claiming it was the 4th of July holiday, something that should be seasonally adjusted away. Either way, there are different seasonal factors at play in this report. The unadjusted claims moved in the good direction:

The advance number of actual initial claims under state programs, unadjusted, totaled 498,022 in the week ending July 17, a decrease of 13,113 from the previous week. There were 585,575 initial claims in the comparable week in 2009.

The advance unadjusted insured unemployment rate was 3.6 percent during the week ending July 10, an increase of 0.1 percentage point from the prior week. The advance unadjusted number for persons claiming UI benefits in state programs totaled 4,581,351, an increase of 186,572 from the preceding week. A year earlier, the rate was 4.7 percent and the volume was 6,256,960.

I am a little concerned at the increase in the number of people claiming UI benefits from state programs. I’m not sure how the number could jump that fast without a massive decrease in temporary work. I am curious if some states do not exhaust state programs before switching to Federal programs. If that happens, then the previous expiration of the Federal support may explain the entire change. One explanation is reason for concern. The other means very little.

The good / bad lists look quite a bit worse than last week (this tracks last week’s unadjusted new claims number). They should get a little better next week:

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

The bad list (+1000 or more): IA, AZ, PR, PA, KS, AR, NC, WI, KY, TX, MO, FL, GA, MI, IN, NY

NY (the worst) was +18,047 vs NJ (the best) at -10,585. Remember that this was unadjusted data from a shorter week, so there’s less reason to celebrate the good list than to fear the bad list, though seasonal factors certainly apply. Service, manufacturing, construction and trade all are well represented in the bad list. This must be expected in a list this long. The downturn in the Texas financial industry is the only surprise in the comments.

In other news, a few hundred thousand people collecting UI benefits started to exhale last night. The Senate passed the unemployment insurance extension bill. Note that this continues the old programs, it does not extend benefits beyond 99 weeks. The extension is retroactive to the lapse in the old extension (June 2). I found an informative FAQ here. What isn’t addressed there is the status of Federal COBRA subsidies, something that appears to have been dropped.

If you accept the analyst narrative that last week’s report was boosted by a different annual schedule for automakers, this report isn’t quite as bad as it looks. Last week’s report would still be worth celebrating until the point that the autoworkers stop working or the cars stop selling. If you accept the Labor Department’s view that an annual holiday skewed the seasonally adjusted numbers, then this report is pretty bad and last week’s report wasn’t as good as it appeared. Independent of the correct explanation, new claims are still too high. The labor market is unstable, at levels that are not conducive to sustained jobs growth absent a pretty spectacular boom. If our jobs growth is similar to the recovery in the last recession, we will not recover until 2021 because of projected growth in the labor force.

-By crazynutjob