26/9/20: America’s Scariest Charts: Employment & Initial Unemployment Claims

 

Starting with initial unemployment claims (continued claims are covered in the earlier post: https://trueeconomics.blogspot.com/2020/09/26920-americas-scariest-charts_27.html) through the week ending September 19, 2020, based on non-seasonally adjusted data:

  • Initial unemployment claims fell to 796,015 in the week ending September 12 - marking the lowest number of new claims filed in any week since the start of the COVID19 crisis.
  • The new claims rose back to 824,542 in the week ending September 19, bringing the numbers of new claims back above 800,000.
  • The latest 4 weeks average new unemployment claims stand at 830,890 weekly claims, which is above the highest number reached since the peak of the Global Financial Crisis. 
  • Pre-COVID19 period historical high was attained in the week of September 1, 1982 at 1,073,500 new claims filed. The latest reading for September 2020 ranks as the 35th highest in the entire history and 10th highest if COVID19 period data was excluded from the set.
  • The latest 3 months cumulative new claims number stands at 13,789,312, down from the COVID19 pandemic peak of 41,865,591. 
  • Current cumulative count (3 months) is 4,607,312 above the pre-COVID historical high attained March 1, 1975.
  • Since the start of the labour markets recovery, average weekly improvement in the initial claims has been a reduction of 224,453 claims per week. This fell to just 305 claims reductions per week over the last 4 weeks. This is not encouraging.
Chart to illustrate the dynamics:


Now, employment figures, based on the seasonally-adjusted non-farm payrolls through August 2020 (the latest data we have):


As it says in the boxes in the chart: 
  • Current reading to pre-crisis high is still down 11,549,000, but we are up on crisis period low by 10,612,00.
  • Crisis low employment to pre-crisis high was down 22,160,000, and the running rate of the recovery since the lowest point of employment in COVID19 pandemic has been an addition of 2,653,000 per month on average. With this rate of recovery, it will take the economy 4.4 months to regain pre-COVID19 levels of employment.
  • However, last month's rate of jobs recovery was only 1,332,000, which implies employment levels recovery to pre-COVID19 levels of 6.7 months, at this rate of jobs growth.