Initial Jobless Claims Jump Again, Reflecting Nation's Bumpy Recovery
Economists consider the four-week moving average to be the more useful statistic, as it smooths out anomalies due to holidays, strikes, and weather-related layoffs, but the jump in initial jobless claims is a disappointment, nonetheless.
At this stage of a U.S. economic expansion, initial jobless claims would normally be below 400,000. But this recession, which was deepened by the financial crisis, has defied numerous, historical economic norms and patterns, and the expected trend in jobless claims has been one.
This week's report did contain one apparent ray of light: Continuing claims decreased 40,000 to 4,625,000. While that number is still very high, its far below where things stood a year ago, when continuing claims hit an appalling 6,449,000.
Continuing Claims: Only Half the Unemployment Story
Now, if only continuing claims told the entire, long-term unemployment story. Unfortunately, they don't.
Due to the pronounced recession, which has eliminated more than 8 million jobs, Congress established -- and has extended several times -- an Emergency Unemployment Compensation program to provide benefits to adults who have exhausted their regular state benefits. This week, states reported 5,101,000 persons claiming Emergency Unemployment Compensation benefits for the week ending May 1, the latest week for which data is available, a decrease of 94,788 from the prior week. A year ago, there were 2,290,000 million EUC claimants.
In other words, while continuing claims have declined by about 1.8 million over the past 12 months, emergency claims have increased by about 2.8 million.
Add those figures to a couple of other Labor Department categories and the net result is that about 15.3 million Americans who are looking for work can't find it. Millions of others are classified as underemployed, such as part-time employees who want full-time work. And in its April employment situation report, the Labor Department also calculated the number of long-term unemployed -- adults who have been jobless for 27 weeks or longer -- at 6.7 million.
Larger Pattern Still Appears Positive
Nonetheless, despite this week's report, it does appear that the U.S. job market has turned the corner, and the nation's long period of sustained job losses is finally over: The U.S. economy added 290,000 jobs in April after a gain of 230,000 in March.
That's an average, monthly job gain of 260,000. Now, all the economy needs to do is follow the shampoo bottle cliche: "Lather, rinse, repeat." If we can replicate those gains every month for the next five years, the U.S. employment situation will be healthy and strong again.