In the week ending April 25, the advance figure for seasonally adjusted initial unemployment claims was 3,839,000, a decrease of 603,000 from the previous week's revised level, according to the latest data from the Department of Labor. The previous week's level was revised up by 15,000 from 4,427,000 to 4,442,000. The 4-week moving average was 5,033,250, a decrease of 757,000 from the previous week's revised average. The previous week's average was revised up by 3,750 from 5,786,500 to 5,790,250.
“As with the prior weeks, a few caveats make this week’s data difficult to interpret precisely,” said Doug Duncan, Chief Economist at Fannie Mae. “On one hand, UI eligibility rules have been relaxed recently, increasing the number of people who are able to apply. This makes it difficult to estimate the uninsured unemployed share of the workforce. On the other hand, many states reported a significant backlog of UI applications due to a lack of processing capacity, indicating that this week’s release may understate the true extent of insured layoffs.”
The advance seasonally adjusted insured unemployment rate was 12.4% for the week ending April 18, an increase of 1.5 percentage points from the previous week's revised rate. This marks the highest level of the seasonally adjusted insured unemployment rate in the history of the seasonally adjusted series. The previous week's rate was revised down by 0.1 from 11.0 to 10.9%. The advance number for seasonally adjusted insured unemployment during the week ending April 18 was 17,992,000, an increase of 2,174,000 from the previous week's revised level. This marks the highest level of seasonally adjusted insured unemployment in the history of the seasonally adjusted series. The previous week's level was revised down by 158,000 from 15,976,000 to 15,818,000. The 4-week moving average was 13,292,500, an increase of 3,733,250 from the previous week's revised average. The previous week's average was revised down by 39,000 from 9,598,250 to 9,559,250.
According to Black Knight Financial Services, in its latest Mortgage Monitor Report, if unemployment reaches 15%, 3.5 million more mortgages could fall into delinquency if the relationship between unemployment and delinquency follows a similar pattern as the Great Recession.
After noting that “home loan delinquency and foreclosure rates were the lowest in a generation before the COVID-19 pandemic hit,” Frank Nothaft, Chief Economist at CoreLogic, stated that, “recession-induced job losses will fuel delinquencies.”