Unemployment Claims Dip Below One Million for the First Time Since March

Mish

Initial state unemployment claims dipped below the million mark for the first time since March 15.

Slow Improvement in Initial Claims

The US Department of Labor reports seasonally-adjusted initial claims fell to 963,000 for the week ending August 8.

Improvement is steady but slow. The string of 20 straight weeks above the million mark just ended.

Continued Claims in 2020

Continued State Unemployment Claims in 2020 August 13 Report

Continued state unemployment claims showed a bit of progress but progress is slower.

Continued claims have been above the 15 million mark for 17 consecutive weeks. 

The BLS reference week for the next jobs report is the week that contains the 13th of the month. That's the week that determines the official unemployment rate. 

That is this week. But we will not see that data for two more weeks. The "current" continued claims data is as of August 1, at 15,486,000.

Four Continued Claim Factors

  1. Continued claims lag initial claims by a week.
  2. People can find a job and drop off the unemployment rolls.
  3. People can expire their benefits and drop off the rolls.
  4. People can retire and drop off the rolls.

Note: My Initial Claims and Continued Claims charts are Seasonally-Adjusted. The following PUA and Totals are NOT Seasonally-Adjusted.

Primary PUA Claims

Primary PUA Claims in 2020 August 13 Report

Primary PUA covers those who are not eligible to make state claims. People working part-time can also claim PUA. 

The report lags initial claims by 2 weeks and continued claims by 1 week.

Primary PUA claims dropped by over two million for the week ending July 25. 

PUA benefits ended July 25 due to Congressional bickering. Did that impact the counts? 

There may also be seasonal factors. PUA claims are not seasonally adjusted.

All Continued Claims

All Continued Claims in 2020 August 13

No Double Counting Just Misleading

All Continued Claims is sum of all the various programs.

There is no double-counting as widely reported. 

One either applies at the state level or the Federal Level, not both. And one must first apply at the state level. 

There are currently 28,257,995 people collecting "assistance". Confusion stems from the fact that not all of those people are unemployed. 

PUA allows part-time workers to apply. They will not show up in the monthly jobs report as unemployed. 

There are also some collecting PUA who are genuinely unemployed who simply do not qualify for any state programs. 

Number of Unemployed

The number of unemployed is somewhere between 15,486,000 (continued claims) and 28,257,995 (all claims).

My guess is around 20,000,000 but the BLS will report far less due to extremely strict countingh guidelines plus admitted errors. 

Expired Benefits

It's important to note that those on PUA only who are not working part-time have no money coming in. 

This is where it gets confusing.

Individuals must first apply at the state level. If not covered then they can apply for PUA. Persons who qualify at the state level get state benefits plus PUA. This is part of the double-counting confusion.

Those on PUA but not a state program have no money coming in unless they are working on the side.

Due to Congressional bickering the last PUA check is for the week ending July 25. Today is August 13. In two days, another check for $600 would be owed.

That will be the third missed check for everyone on PUA.

Trump authorized another $400 but with states having to supply $100, so really only $300. States have no way to implement that as outlined in the executive order. And most if not all do not have the $100 to contribute.

Related Articles

  1. Trump Signs 4 Executive Orders, One Requires States Pay 25% of the Cost
  2. Boston Fed President "The Recovery is Losing Steam"
  3. Millennials Screwed Again, This Time on Unemployment
  4. Heaven Help Us if Unemployment Follows the Path of the Great Recession

Point number 4 is particularly ominous.

Mish

Comments (25)
No. 1-9
PecuniaNonOlet
PecuniaNonOlet

81 Days till election.

Do you know where your jobs are?
Are you better off than you were four years ago?

numike
numike

A Government Too Broken to Write $600 Checks
The president and the Senate majority leader weren't even in the room for the failed negotiations to save the economy.

Tony Bennett
Tony Bennett

"It's important to note that those on PUA who are not working part-time have no money coming in."

...

Are you sure this is correct? I think those on PUA get regular benefits + $600 week. Now just the regular benefit. The below is from a DOL pdf. I tried linking but comment was eaten with link.

Summary – On March 27, 2020, President signed into law the CARES Act, which
includes the Relief for Workers Affected by Coronavirus Act set out in Title II, Subtitle A. Section 2102 of the CARES Act creates a new temporary federal program called Pandemic Unemployment Assistance (PUA) that in general provides up to 39 weeks of unemployment benefits, and provides funding to states for the administration of the program. Individuals receiving PUA benefits may also receive the $600 weekly benefit amount (WBA) under the Federal Pandemic Unemployment Compensation (FPUC) program if they are eligible for such compensation for the week claimed.

tokidoki
tokidoki

So we've dropped below 30 million. The economy is improving. No more checks required. Atlanta GDP Fed reading is probably accurate.

Sechel
Sechel

I agree that right now Continue claims will be the more interesting number of the two.

Carl_R
Carl_R

The drop isn't surprising. With the extra $600/week gone, people now have an incentive to find jobs. This is good, in the sense that those businesses trying to expand can now actually find help, but there are not enough jobs for everyone. It is a long way back from 30m unemployed.

Herkie
Herkie

We will see what the revision is next week.

njbr
njbr

...Trump authorized another $400...

No, he authorized $300 from FEMA disaster funds that could last 4 or 5 weeks IF the money is actually shifted into the state programs in a manner that allows the states to actually distribute the money.

The other $100 is supposed to come from states funds--which they really don't have.

Partial...if...if... perhaps...maybe..

The story of mismanagement.

Six000mileyear
Six000mileyear

Running out of non-essential people to let go. Big corporations are preparing to let go essential people this fall.