New Surge in Layoffs and Benefits Victims

We keep a regular tap on the labor market here. This week’s report from the DOL could illustrate what may be the start of a new surge in layoff activity. Be sure to also find our original reasoning behind the disappearance of many from the unemployed pool, into the abyss of the high and dry and still unemployed pool.

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New Surge in Layoffs and Benefits Victims

Weekly Jobless Claims gained by 9,000 in the period ending August 13, rising to 408K. The dip under 400K was short-lived, and may not be seen again soon in my estimation, except perhaps by means of late August malaise in the HR departments of companies across America.

The four-week moving average for jobless claims actually fell this week by 3,500, to 402,500, possibly illustrating the turn I’m portraying. The weekly figure would lead the four-week moving average at inflection point. Truth be told, we’ve gone in no direction whatsoever over recent weeks, sticking around the 400K mark. It’s not a healthy situation, but it could get worse as labor markets perhaps catch up with what we’re seeing in consumer sentiment, stocks, manufacturing and in housing.

Today’s Philly Fed Survey showed more manufacturers cutting workforce than adding to it, and that trend should continue and accelerate if recession takes hold. The insured unemployment rate held steady at 2.9% in the period ending August 6 (lagged), but the number of insured jobless increased by 7K in the period. That marks a change in trend, as recent periods have shown a drop-off of the unemployed. I say drop-off, because it’s unclear where they have gone to, since it does not appear they’ve been hired anywhere. We’re sending rescue teams out to tent cities, which are popping up across suburban grounds once known as public parks.

The number of folks insured under all programs, including the employment insurance extension program was measured for the July 30 period, and still showed decline, with 143,737 less people in programs. Again, where they’ve gone to, nobody knows.

All jesting aside, this is a very serious issue. The government is short of the funds to inspire hiring now and has always been short of ideas. I suspect pressure will intensify with regard to the scrutinizing of the long-term unemployed. I’ve already theorized here that budget minded auditing is probably behind many of the unemployed being left high and dry as far as government support goes. It is in fact my view that these people are less likely finding work and more likely finding invoices to pay money back because of failing to meeting some entrapping disguised as government requirement for the maintenance of benefits. I’ve been the first voice mouthing this original opinion; take note as the rest catch up.

More info for your review:

The highest insured unemployment rates in the week ending July 30 were in Puerto Rico (4.7), Pennsylvania (4.3), California (3.9), New Jersey (3.9), Alaska (3.8) , Connecticut (3.8), Oregon (3.7), Rhode Island (3.7), Nevada (3.5) and Arizona (3.4).

The largest increases in initial claims for the week ending August 6 were in California (+7,848), Texas (+1,374), North Carolina (+1,176), Illinois (+988), and Massachusetts (+926) while the largest decreases were in Florida (-2,580), Puerto Rico (-1,705), Indiana (-900), Oregon (-544), and Kentucky (-487 ).

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