economy Markets

Jobless Claims Point To Unhappy Equilibrium

Hopes for additional virus relief from Congress faded this week, with the GOP’s “skinny” bill destined to fail, and Democrats and Republicans no further along in the quest to strike a deal on a broader stimulus package.

Absent another round of fiscal support measures, some worry it’s just a matter of time before the world’s largest economy takes another turn for the 1930s.

With that in mind, 884,000 Americans filed for unemployment benefits last week, unchanged from a revised 884,000 in the prior week, when the figures adopted a different seasonal adjustment methodology.

The four-week moving average fell to 970,750, still a country mile above the pre-pandemic record weekly print from 1982.

884,000 represents a miss to consensus, which was looking for 850,000. The forecast range was 750,000 to 1 million.

Continuing claims disappointed, rising to 13.39 million for the week ended August 29. Consensus was looking for 12.9 million.

These aren’t “good” numbers by any stretch. Every week, I remind folks that outside of the current context (i.e., outside of the pandemic) these figures would be unthinkable.

But beyond that, it certainly appears as though the labor market momentum is set to stall. The August jobs report was in-line with estimates, but analysts generally believe that was the last of the “easy” gains. Claims will apparently settle in around current levels, and while the unemployment rate was much lower than expected for August, the structural damage began to pile up again, as permanent job losses accelerated after a reprieve in July.

This points to a near-term equilibrium in the labor market, which sounds some semblance of positive, until you remember that initial claims are still running above 800,000 and we’re less than 50% of the way there when it comes to recovering the jobs lost to the pandemic.

I suppose that’s really the key point. We are now six months on from the worst days of the crisis, and the labor market is leveling off with only half of the lost jobs restored.

It may be an equilibrium, but it’s not a happy one.


 

8 comments on “Jobless Claims Point To Unhappy Equilibrium

  1. derek says:

    It’s Sex Pistols Thursday!

    Oh we’re so pretty
    Oh so pretty
    We’re vacant
    Oh we’re so pretty
    Oh so pretty
    A-vacant

  2. Tom Swift says:

    “Figures lie and liars figure.”
    It is hard to believe any of the official and quasi-official numbers. During my annual US sales trip, the crowds of homeless are huge. Crowded truckstops with whole families living in Chevy Cruzes. Long-term “temporary residents” at USFS campgrounds with small villages at undeveloped campsites, it is one word – sad.

    As usual, the R’s are leaving a big pile of doodoo for the D’s to cleanup. I like a country that has more than two parties fighting over the political bone. Just like the elementary plaground that most politicians have the mental capacity to handle.

    The S*** will hit the fan in about 60 days.

    • Anonymous says:

      And the first items on the Senate agenda are 5 more federal judges, one of whom only qualified as a lawyer 8 years ago. So much for priorities.

    • runamok says:

      This story about people living in the Star Motel in Kissimmee. A place “where it was possible to glimpse what a complete social and economic collapse might look like in America.” Decades in the making:

      https://www.washingtonpost.com/graphics/2020/national/kissimmee-star-motel/

      A broken, third-world country for these residents and many others in this country. If you have any free articles left on the Post, this one is worth it.

      America will be remembered as the place and time where the ruling elites were incapable of change.

  3. runamok says:

    I just can’t believe how big of a catastrophe this is. And we’re still in the early months of this whole affair.

    Jobs. Jobs. Jobs.

  4. joesailboat says:

    Trump does not want evictions before the election. Body bags are one thing on TV. Walmart forced to change its camper OK policy for parking lots hitting the headlines another.
    Landlords can suck it up and get rewarded in heaven.

  5. If you think the situation is bad now…you can just imagine what it will be like if Trump wins the election.

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