Jobless Claims Surge Again As Sirens Blare In US Labor Market

In news that should surprise exactly nobody, initial jobless claims surged for a second week in the US.

885,000 people filed for unemployment benefits in the week through December 12. That was far more than the 815,000 consensus expected. Unadjusted claims were 947,000, the highest since July.

The disconcerting news comes on the heels of the previous week’s “surprising” rise, which was itself revised higher (i.e., worse) to 862,000. The four-week moving average is now back above 800,000.

885,000 is the worst print on initial claims since the week of September 5.

Congress was still haggling over the terms of a new virus relief package on Thursday — politics before polity. According to reports, the likely deal will include $600 direct payments to individuals and an extension of a $300 federal supplement to the unemployed.

Markets, economists, and especially lawmakers have clearly lost the plot. The fact that the stimulus deal didn’t come together until quite literally the last days of the lame duck session is proof positive that lawmakers aren’t telling the truth to suggest that their sense of urgency is tied to anything other than the calendar and the Georgia runoffs.

It’s been nearly five months since provisions from the previous relief package began to expire, including the federal assistance for the jobless. Some benefits were extended by Donald Trump via an executive order, but that process was confusing and fraught with logistical issues.

Continuing claims were 5.5 million in the week ended December 5. That was a bit better than expected. The market was looking for 5.7 million.

Initial PUA claims jumped 40,000 in the week to December 12. Ongoing PUA and PEUC claims look to have surged in the week ending November 28, by 688,793 and 268,532, respectively. There were 9.2 million people on PUA (the federal assistance program for workers not normally eligible for state jobless benefits, including the self-employed) as of late last month and 4.8 million receiving PEUC.

I suppose there’s some “nuance” to be had in these numbers (it seems like each week, somebody rolls out a new factoid or statistic that’s supposed to be “mitigating”), but my initial claim (get it?) is that these figures are disconcerting. You’d be forgiven for suggesting that new lockdowns associated with the virus surge are affecting jobs.

Obviously, one should consider this in conjunction with the disappointing November jobs report and also in the context of common sense, which dictates that things are likely to go awry when novel, deadly, viral pneumonia is allowed to spread unchecked across an economy that relies almost entirely on a high-contact services sector.