First-time claims for unemployment insurance for the week ending August 10 fell to the lowest level since January 2008, the ""Labor Department"":http://www.ows.doleta.gov/press/2013/081513.asp reported Thursday. The department said there were 320,000 new claims for unemployment insurance, a drop of 15,000 from the previous week. Economists expected the number of claims to drop to 330,000 from the 333,000 originally reported for the week ending August 3. The number of filings for that week was revised to 335,000.[IMAGE]
The four-week moving average of initial claims fell to 332,000, the lowest level since November 2007--one month before the recession began.
The number of persons continuing to collect unemployment insurance for the week ending August --reported on a one week lag--also fell, dropping 54,000 to 2,969,000. The number of continuing claims for the week ending July 27 was revised up to 3,023,000 from the originally reported 3,018,000.
The plunge of first-time claims continues a longer-term pattern of decline, which has seen the four-week moving average tumble almost 9 percent from 364,500 a year ago.
While a large part of the decline is due to fewer layoffs, some is attributable to favorable seasonal adjustment factors applied by the Department of Labor for predictable and annually recurring events that affect claims. The adjustment factor for the week ending August 10 was 87.7. An adjustment factor below 100 reduces the raw number of claims to the seasonally adjusted number, which is used for reports. The factor will continue to remain low through Labor Day, when it bottoms at 78.1, suggesting further declines in reported claims.
Thursday's report on first-time claims was consistent with a trend with other reports by the Bureau of Labor Statistics (BLS) showing a slowdown in layoffs and discharges--events that lead to unemployment insurance claims.
This report on initial claims will have no impact on the August Employment Situation report to be released September 6 by BLS. That report will be based on employment data for the week including the 12th calendar day of the month (covered by the claims report to be released next week).
The week-over-week decrease in continuing claims, which largely reflects hiring, was the third in the last four weeks. The four-week moving average of continuing claims has fallen a net 35,250 in those four weeks.
The Labor Department said the total number of people claiming benefits in all programs for the week ending July 27 was 4,586,860, an increase of 65,906 from the previous week. There were 5,704,310 persons claiming benefits in all programs in the comparable week in 2012. Extended benefits were not available in any state during the week ending July 27.
According to BLS, 11,514,000 persons were officially considered unemployed in July, with 4,246,000 ""long-term"" unemployed--that is, out of work for at least 27 weeks. Of those individuals counted as unemployed, 6.93 million were not receiving any form of government unemployment insurance for the week ending July 27, down from 6.99 million one week earlier.
The Labor Department said states reported 1,552,910 persons claiming Emergency Unemployment Compensation (EUC) benefits for the week ending July 27, an increase of 36,635 from the prior week. There were 2,373,969 persons claiming EUC in the comparable week in 2012. EUC benefits this year were directly threatened by the federal budget sequester.
According to the Labor Department detail, also reported on a one-week lag, the largest increases in initial claims for the week ending August 3 were in California (+3,715), Ohio (+1,270), Texas (+1,151), Pennsylvania (+999), and Puerto Rico (+816), while the largest decreases were in Oregon (-1,638), Illinois (-999), New Jersey (-762), New York (-712), and Connecticut (-632).
California reported the increase in first-time claims for the week ending August 3 was attributable to more layoffs in the service sector, while Ohio cited more layoffs in manufacturing.
_Hear Mark Lieberman Friday on P.O.T.U.S. radio, Sirius-XM 124, at 6:20 a.m. Eastern.