Initial Unemployment Claims: Light at the End of the Tunnel? December 31, 2009Posted by geoff in News.
The initial unemployment claims data for December looks promising – around Thanksgiving we broke through the 500,000 claims/week barrier, and last week there were only 432,000 claims (seasonally adjusted). Here’s what the last couple of years look like:
So we’re still losing jobs, but at a slower rate. If we use the data since the peak to project when the unemployment rate itself might max out (when the line gets into the “Breakeven Zone”), we get this plot:
This suggests that the unemployment rate will peak somewhere between May and August. The recent weeks, however, have shown a slightly sharper decline – if that trend holds we could peak as early as the end of March. That would be nice.
I was looking at the seasonal adjustments to these claims, and compared the 2008 and 2009 adjustments at the end of the years (when seasonal adjustments are large). Naturally I plotted up the comparison:
They track very closely until the end of the year, when the correction for 2009 is significantly smaller than for 2008. If the corrections were the same, we’d see an even lower initial claims number. I’m sure they have their reasons, but I thought it was interesting so I decided to inflict it on you.