Category Archives: crisis

4/2/21: U.S. Labor Markets: America’s Scariest Charts, Part 5

 The first four posts on the state of the U.S. labor markets have covered:

  1. Continued Unemployment Claims (;
  2. Labor force participation rate and Employment-to-Population ratio (; 
  3. Non-farms payrolls (; and
  4. New (initial) unemployment claims data through January 30, 2021 (
In this post, let's take a look at the latest data on average duration of unemployment through December 2020:

As the chart above clearly shows, current average duration of unemployment spell is already higher than the peak of any prior recession other than the Great Recession. However, the duration remains relatively benign when we control for the business cycle (red line and the chart next).

Dynamically, it is hard to imagine average duration of unemployment to be staying around its current levels. Something to watch in months to come as an indicator of the direction of structural (as opposed to cyclical) unemployment. 

4/2/21: U.S. Labor Markets: America’s Scariest Charts, Part 4

 The first three posts on the state of the U.S. labor markets have covered:

  1. Continued Unemployment Claims (;
  2. Labor force participation rate and Employment-to-Population ratio (; and
  3. Non-farms payrolls (
In this post, let's take a look at new unemployment claims data through the week of January 30, 2021:

The data confirms the worrying trends cited in reference to continued unemployment claims. In the last week of January 2021, based on preliminary estimates published today, initial unemployment claims stood at 816,247 - a decline of just 23,525 on prior week reading. The 4-weeks cumulative initial unemployment claims are at 3,744,581, which only 103.433 down on prior 4 weeks period. Net, over the last 5 weeks, the reduction in initial unemployment claims stands at a miserly 19,725. 

Despite little media coverage, the U.S. labor markets remain stricken by the pandemic effects on economic activity. If we strip out data for the pandemic period-to-date, the latest weekly reading for initial unemployment claim ranks as the 10th highest in the history of the series. 

4/2/21: U.S. Labor Markets: America’s Scariest Charts, Part 3

 In two prior posts, I covered two of America's Scariest Charts:

  1. Continued Unemployment Claims ( and 
  2. Labor force participation rate and Employment-to-Population ratio (
Here, let's take a look at non-farm payrolls that measure employment levels in the economy.

In December 202, employment growth stalled. In fact, non-farm payrolls fell 328,000 in the last month of 2020 to 143,777,000, or 9,400,000 below pre-pandemic peak. December was the first month of declines in employment since April 2020, but employment growth was relatively slow already in November when the U.S. economy added 603,000 jobs, the slowest pace of recovery after July for the entire period of recovery of May-November 2020.

This evidence further reinforces the argument that labor markets conditions in the U.S. remain abysmal, prompting American workers to slip out of the labor force. 

24/10/20: America’s Scariest Charts: Duration of Unemployment & Employment Index

Two previous posts covered some core labor markets data for the U.S.:

Here, let's take a look at the weekly (higher frequency) data unemployment claims.

First, initial unemployment claims, with data coverage through the week of October 17th:

The above chart shows 1-month cumulative initial unemployment claims, smoothing some of weekly volatility in the series.

Current reading stands at 3,194,750 which is above the 2008-2011 crisis peak of 3,169,786 and only slightly below all-time pre-COVID19 high of 3,313,000 attained in January 1975.

In absolute level numbers, preliminary first-time claims for the week of October 17, 2020 stand at 756,617 which is still 3 times the rate of first-time claims filings in the last week before COVID19 pandemic onset (March 14, 2020). The good news is, preliminary estimate for the new claims for the week of October 17 suggest a decline in new claims filings of 73,125 on week prior - the fastest rate of reductions in 10 weeks. However, overall average weekly decline in first-time claims over the last 10 weeks has been rather unimpressive at 8,212. At this rate of improvement, it will take almost 62 weeks to draw current first-time claims down to the levels seen in the last pre-COVID19 week.

In line with the crisis timing, average duration of unemployment is climbing up, too:

Based on monthly data through September 2020, average duration of unemployment is about to hit pre-crisis average in October. This sounds like a good thing, until you realise that the duration of unemployment fell to historically low levels as COVID19 crisis unfolded because of the unprecedented rate of jobs losses and unemployment claims increases (see net chart below). It remains to be seen how it will behave in months ahead. 

Past three recessions have been associated with increasing average duration of unemployment through recovery periods. They have also been associated with longer periods of elevated duration. In fact, in the last three recessions, average duration of unemployment never reached pre-recession levels, implying that long-term unemployment got worse in every recovery period since 1990 on. If this trend is consistent with the COVID19 recession, U.S. long term unemployment duration will rise once again. 

For the last chart, consider employment index dynamics though September 2020:

Despite the headline 'historically fast' recovery, actual employment remains in dire state, with current dynamics through September 2020 indicating the third worst employment performance in the history of the modern economy. Based on the 3-months average gains in seasonally-adjusted employment, it will take us another 8 moths before we regain pre-crisis peak employment levels, implying the 5th fastest recovery in employment in history. Based on September rate of improvement, the process will take another 16 months, which would make the current recovery the fifth slowest on record. Based on the dynamics of change in the jobs recovery since May 2020, we can expect the jobs recession to last 45 months, which would make it the 3rd worst recession in history. So far, the average rate of decline in the jobs gained per month during the recovery is 15% per month. 

In the Great Recession, it took the economy 76 weeks to recover from trough of the recession to pre-recession peak employment. The average monthly rate of recovery from the trough until regaining pre-recession peak was 0.128% per month. This would put the month when we would recover from the COVID19 pandemic to July 2025, making the COVID19 pandemic a second worst recession in history after the Great Recession.

24/10/20: America’s Scariest Charts: Non-farm Payrolls

In the previous post, I covered data for the U.S. Labor Force Participation and Employment to Population Ratios (see Now, let's update the data for Total Nonfarm Payrolls through September:

At the end of September, total non-farm payrolls stood at 141,855,000 - up 1,137,000 on August, and still down 11,322,000 on pre-COVID19 peak. We are now just over half-way to the recovery from COVID19 trough of 130,317,000 reached in April 2020. Since reaching trough, non-farm payrolls rose, on average, at a monthly rate of 2,308,000, which means that the latest increase over the month of September has been substantially slower than the average rate of recovery. 

At September rate of jobs recovery, it will take us almost 10 months to regain pre-COVID19 peak. 

Current levels of payrolls are consistent with February 2016 levels, implying that even after we are still missing some 4.5 years worth of jobs creation. 

Here is a genuinely scary table, highlighting the fact that in the COVID19 pandemic, the U.S. sustained jobs losses of the combined magnitude equivalent to those suffered in all recessions from 1980 through the Great Recession:

And while the recovery is clearly under way, broader indicators of the jobs markets trends are still pointing to a horrific aftermath of the first of this pandemic, with the second wave now in full swing (see more on this here: