Initial Claims for unemployment insurance came in at 502K this week down from an upwardly revised 514K last week. The four week moving average now stands at 515K
A few weeks back I wrote about how the seasonal auto adjustment had introduced a false dip the lead first to jubilation and then to depression about the trajectory of the New Claims series. However, we’ve gotten past that now and it is remarkable how well the decline has stabilized.
The blue line represents the average weekly declines since the peak on 4/4/2009. By construction the variance of this series should stabilize. In other words it should go from a wobbly line to a smooth line. However, what’s notable is that the level has remained fairly constant since late May. That is, the new claims series has been declining at roughly 5K per week since the beginning.
The change in the four week moving average has seems to be getting a little more stable in terms of volatility as well.
The 5K per week decline means that we are roughly 24 weeks out from 384K, the level at which on average the payroll series began to grow.
If I get a chance I’d like to project out Justin Fox’s payroll chart (shown below) based on a steady 5K decline.
As always, the long view
Leave a comment
Comments feed for this article