Thread: Unemployment drops to lowest level in five months!

Might not be time to celebrate just yet.

EW YORK (CNNMoney.com) -- The number of Americans filing for initial unemployment insurance rose last week, the government said Thursday.

There were 480,000 initial jobless claims filed in the week ended Jan. 30, the Labor Department said in a weekly report. This is the highest level since Dec. 12 and up 8,000 from an upwardly revised 472,000 the previous week.

Economists were expecting claims to drop to 455,000, according to a consensus estimate from Briefing.com.

The 4-week moving average of initial claims was 468,750, up 11,750 from the previous week's revised average of 457,000.

"My general outlook had been that the worst of the layoffs were behind us," said Tim Quinlan, an economic analyst at Wells Fargo. "But this shows us that employers still have more fat to trim."

Continuing claims: The government said 4,602,000 people filed continuing claims in the week ended Jan. 23, the most recent data available. That was up 2,000 from the previous week's revised 4,600,000 claims.

The 4-week moving average for ongoing claims fell by 51,250 to 4,617,500 from the previous week's revised 4,668,750.

But the drop may just mean that more filers are dropping off those rolls into extended benefits.

Jobless claims rise to 480,000 in latest week - Feb. 4, 2010

Matt

Here's a source for the rate drop:

WASHINGTON (MarketWatch) - The unemployment rate fell in January to 9.7% from 10% in December, the Labor Department said Friday. Nonfarm payrolls contracted by 20,000 in January. Economists surveyed by MarketWatch had expected a 25,000 gain and for the unemployment rate to remain steady at 10.0%. Under the revisions released today, job losses since the start of the recession in December 2007 totaled 8.4 million. This was in line with expectations.

U.S. Jan jobless rate falls to 9.7%, low since Aug - MarketWatch

It's a minor - very minor - sign of improvement, IMHO.

Matt

Originally Posted by Danny

Breaking on news right now. No link yet. Its like 9.75% nationally.

This is great news. Its fairly evident the recovery is well under way and the last remaining factor are the jobs. It seems the American people have given Obama about 1.75 years to fix the Republican recession he inherited before it becomes the Democratic recession. If the jobs come back before the end of summer, things will look pretty good for the Dems.

That will be no small feat either. With 3 trillion in lost tax revenue due to the recession stolen from him before the man walked in the door, fixing an economy with such deficits is unbelievable.

Underemployemnt is at 17%, and this is a temp dip..

I would hope it a trend downward, but with OBAMA's NEW taxes on business nad the people that actually HIRE others, I fear it will not be.

Btw, when I posted job news it was removed from breaking news...

Like Matts article which caps the overall point, the following articles taken together do a pretty good job I think in explaining some of the kinks and categories as to why a same person may think they are going nuts when month to month filing for claims is still up, but the unemployment number drops.....only in the convoluted world of gov. accounting...but I digress..


The unemployment rate dropped unexpectedly in January to 9.7 percent from 10 percent while employers shed 20,000 jobs.

The Labor Department says the rate dropped because a survey of households found the number of employed Americans rose by 541,000. The job losses are calculated from a separate survey of employers.

The report also included an annual revision to the estimates of total payrolls, which showed there were 930,000 fewer jobs last March than previously estimated. The department also revised down its estimates for April through October of last year, adding another 433,000 job losses.

January unemployment rate drops to 9.7 percent - Yahoo! News




Taxes are another indicator of payrolls, specifically withheld income taxes. The daily Treasury Department statement tracks withheld income taxes. In January, income taxes withheld dropped about 9.4% from December, about the same as the drop from December 2008 to January 2009. December withholdings are sometimes inflated due to end-of-year bonuses. That the decline from December to January this year was the same as last argues that the direction of payroll jobs will track year-year.


What to Look Out for in the January Employment Report - FOXBusiness.com


snip-

Construction employment declined by 75,000 in January, with nonresidential specialty trade contractors (-48,000) accounting for the majority of the decline. Since December 2007, employment in construction has fallen by 1.9 million.

In January, transportation and warehousing employment fell by 19,000, due to a large job loss among couriers and messengers (-23,000).

Employment in manufacturing was little changed in January (11,000). After experiencing steep job losses earlier in the recession, employment declines moderated considerably in the second half of 2009. In January, job gains in motor vehicles and parts (23,000) and plastics and rubber products (6,000) offset small job losses elsewhere in the industry.

In January, temporary help services added 52,000 jobs. Since reaching a low point in September 2009, temporary help services employment has risen by 247,000.

Retail trade employment rose by 42,000 in January, after showing little change in the prior 2 months. Job gains occurred in January among food stores (14,000), clothing stores (13,000), and general merchandise retailers (10,000).

Health care employment continued to trend up in January. Ambulatory health care services added 15,000 jobs over the month.

In January, the federal government added 33,000 jobs, including 9,000 temporary positions for Census 2010. Employment in state and local governments, excluding education, continued to trend down.

Employment Situation Summary

and last but not least matts article details.....


In January, the number of persons unemployed due to job loss decreased by 378,000 to 9.3 million. Nearly all of this decline occurred among permanent job losers. (See table A-11.)

The number of long-term unemployed (those jobless for 27 weeks and over) continued to trend up in January, reaching 6.3 million. Since the start of the recession in December 2007, the number of long-term unemployed has risen by 5.0 million. (See table A-12.)

Employment Situation Summary

the temp. job market is seeing gains,as highlighted above, thats a good short term thing but getting into oct./ nov. that won't cut it, those jobs often come with no or skimpy benefits, it helps the 'number' but it isn't really what we need to see.

Recovery "well on its way"...too funny.
No reason to comment on such a bizarre statement.

It's interesting to look at the BLS definition of unemployment.

Let's say Fred loses his job, and searches for a job for months to no avail. He gives up and moves back with his parents and contemplates where best to hang himself.

Under the BLS definitions, this is a drop in unemployment, since Fred is no longer actively seeking work.

Bizarre, but true. How the Government Measures Unemployment

Matt

Originally Posted by MattInFla

It's interesting to look at the BLS definition of unemployment.

Let's say Fred loses his job, and searches for a job for months to no avail. He gives up and moves back with his parents and contemplates where best to hang himself.

Under the BLS definitions, this is a drop in unemployment, since Fred is no longer actively seeking work.

Bizarre, but true. How the Government Measures Unemployment

Matt

I'm curious how the never-ending extension of unemployment benefits affects this. Don't you have to be actively seeking employment to receive benefits?

Originally Posted by MattInFla

It's interesting to look at the BLS definition of unemployment.

Let's say Fred loses his job, and searches for a job for months to no avail. He gives up and moves back with his parents and contemplates where best to hang himself.

Under the BLS definitions, this is a drop in unemployment, since Fred is no longer actively seeking work.

Bizarre, but true. How the Government Measures Unemployment

Matt

it's not that bizarre, matt. the level of employment in this country is calculated as the number of people who want to work divided by the number of people who are actually working. makes perfect sense to me.

that said, this is good news, but it's not time to get out our party hats and celebrate the mark of the golden age of obamanomics.

Originally Posted by Cari

I'm curious how the never-ending extension of unemployment benefits affects this. Don't you have to be actively seeking employment to receive benefits?

I know you do in Florida - my brother in law has been out of a job for over a year, and he had to provide information to the unemployment folks on where he applied, etc.

He's in a training program now, so he doesn't have to seek work until it is done.

And in the BLS stats, he's no longer "unemployed" even though he doesn't have a job.

Matt

Originally Posted by MattInFla

I know you do in Florida - my brother in law has been out of a job for over a year, and he had to provide information to the unemployment folks on where he applied, etc.

He's in a training program now, so he doesn't have to seek work until it is done.

And in the BLS stats, he's no longer "unemployed" even though he doesn't have a job.

Matt

I don't think any of the numbers that are calculated the "old way" are really giving us a clear picture of what is going on in the country. Are there any people who have actually had their benefits run out because of time? I mean we're knocking on the door of 2 years here.

Only in the slobbering Obama media would the loss of 20,000 jobs be trumpeted as 'a turnaround' and be met with great fanfare!

I remember all too clearly back in 2004 when under Bush the economy added 185,000 jobs and the media told us that this number was disappointing and the news took on the tone of a funeral.

Also remember... if the boy-king started adding jobs, right now in February 2010 at that 185k 'disappointing' rate... and added that same amount every month until election day... he still will not have added the number that he has already lost.

Not that you'd know this from the media reporting

Originally Posted by Cari

I'm curious how the never-ending extension of unemployment benefits affects this. Don't you have to be actively seeking employment to receive benefits?

funny you asked, it got me thinking......because others, analysts etc. are wondering how this number ads up and what overall effect is has when the gov. has been adding more and more cash to the EUC pool ( Employment Unemployment Compensation).

Obama keeps adding money to the pool and sending out checks. Its the safety net and as to actively looking well, most states demand that.

I am not sure about that now, my daughter got automatically handed another year without even asking for it......and of course when you don't even COUNT those that have given up looking, the 9.7%, then who cares?

The reporting methodology U6 ( vs. the U3) - which counts everyone was changed in Jan. of 94. to the U3 which discards 'discouraged workers' and adds temps.

Some think the numbers aren't telling us the whole story.....

some snips-

.government spent a record $14.7 billion on Unemployment Insurance Benefits as of December 30, a 24% jump sequentially from the $11.8 billion in November. Yet the DOL (dept of labor) has disclosed a mere 1.7% increase in those to whom insurance benefits are paid: from 9.4 million to just under 9.6 million. To put the $14.7 billion number in perspective, in December the Federal Government paid a total of $14 billion ($700 million less) in Federal Salaries!

And some more perspective: in calendar 2009 the government has paid $140 billion in Unemployment Insurance Benefits. This is yet another economic stimulus that nobody in the administration discusses, yet which undoubtedly has the biggest impact on the economy, as all those millions unemployed can moderate their pain courtesy of a passable weekly check from the government which should just about cover the rent and beer.



also-

as to why the numbers appear whacky;

My answer would be a MASSIVE jump in the Emergency Unemployment Compensation (EUC) benefits, which jumped from 3,594,253 (11/07/09) to 5,143,410 (12/19/09), up 43% in just over a month!

The increase in EUC more than offset the decline in continuing claims and we are now at a new record when combining all measures of unemployment benefits. Economists were pointing out that continuing claims and initial claims were falling as a bullish sign, however what was happening was that those benefits were exhausting for people who used up that benefit, leading to the decline in the numbers which is proved by a record (52.24%) exhaustion rate.




http://www.marketoracle.co.uk/Article16318.html

Originally Posted by tsquare

Only in the slobbering Obama media would the loss of 20,000 jobs be trumpeted as 'a turnaround' and be met with great fanfare!

I remember all too clearly back in 2004 when under Bush the economy added 185,000 jobs and the media told us that this number was disappointing and the news took on the tone of a funeral.

Also remember... if the boy-king started adding jobs, right now in February 2010 at that 185k 'disappointing' rate... and added that same amount every month until election day... he still will not have added the number that he has already lost.

Not that you'd know this from the media reporting

Dude, could you get over Bush already? He's not the president anymore.