February 7, 2013

Initial Unemployment Claims (020713); 366K SA; Year–Over-Year NSA Claims Down Less Than 4%

Filed under: Economy,Taxes & Government — Tom @ 8:17 am

Also, productivity news is not good.

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Predictions are as follows:

  • Bloomberg projects a seasonally adjusted 360,000, down from last week’s 368K before likely prior-week revisions.
  • Reuters also has 360K, along with a prediction that a productivity report coming out today will show a decline.
  • The Associated Press, which typically forgets that it carried predictions once economic reports are released, also has 360K.

This year’s adjustment factor of 105.6 is lower than last year’s 108.2, so actual claims are going to have to come in below last year’s for year-over-year seasonally adjusted claims to fall.

UPDATE, 8:40 a.m.: My email says claims fell to 366K from 371K, but I don’t see DOL’s release yet.

UPDATE 2, 8:45 a.m.: Here it is

EASONALLY ADJUSTED DATA

In the week ending February 2, the advance figure for seasonally adjusted initial claims was 366,000, a decrease of 5,000 from the previous week’s revised figure of 371,000. The 4-week moving average was 350,500, a decrease of 2,250 from the previous week’s revised average of 352,750.

… UNADJUSTED DATA

The advance number of actual initial claims under state programs, unadjusted, totaled 386,176 in the week ending February 2, an increase of 16,696 from the previous week. There were 401,365 initial claims in the comparable week in 2012.

The year-over-year claims difference of less than 4% is not impressive — and the habit of weekly upward revisions to previous week’s numbers appears to have resumed after taking a hiatus of a couple of weeks.

UPDATE 3: Here’s the first paragraph of the productivity report (full HTML with tables) —

Nonfarm business sector labor productivity decreased at a 2.0 percent annual rate during the fourth quarter of 2012, the U.S. Bureau of Labor Statistics reported today. The decrease in productivity reflects increases of 0.1 percent in output and 2.2 percent in hours worked. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the fourth quarter of 2011 to the fourth quarter of 2012, productivity increased 0.6 percent as output and hours worked rose 2.4 percent and 1.8 percent, respectively. Annual average productivity increased 1.0 percent from 2011 to 2012.

This is not the kind of productivity situation we saw from 2009 through 2011. It looks like businesses have squeezed all they can out of their existing employees. It may also be that newbie part-timers aren’t as productive as full-timers.

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1 Comment

  1. Well, yes, one can still be more cost effective with less productive workers when there is a large disparity between the well paid and underpaid. When two underpaid people are less productive but cheaper than one well paid person, you go with the two people. This reminds me of the period of pre-1990s before productivity became an absolute necessity because of global competition and technology. In those days companies were routinely over staffed to ensure the job got done. AT&T comes to mind.

    Then came the 1990s slogan more with less, less is more. Once the competition got fierce from overseas, companies started choosing higher paid quality workers over quantity since they only had to pay an increment more to keep up. Giving vacation and sick benefits as part of the compensation package was part of that required offering to get the most qualified worker. The post 1990s paradigm may be coming to an end. Companies may find that to be cost effective, it may well require hiring two part timers instead of one full timer. From the company point of view, if one full timer gets sick they still have to pay the day’s wage with no output, whereas if one part timer gets sick, the other person can work the extra 4 or 5 hours with no pay for no work for the sick person.

    The voters will have to face the hard facts as the IRS discovered, the minimum cost of an ObamaCare approved healthcare plan is $20,000 a year. This means a $5,000 increase per year on EVERYBODYS existing plan in 2014 when ALL health insurance policies must conform to ObamaCare’s new set of coverage requirements. That $5000 has got to come from somewhere. For some this means no wage increases for years meaning they will fall behind due to inflation. For some this means paying an increasing share of the insurance premium up to the mandated affordability limits. And if the employer can’t get adequate cost containment due to the affordability limits then for those this means losing their full time job and being forced to take two part time jobs (at lower pay) working combined longer hours per week to earn not only what they had before but extra to pay for that extra cost in coverage.

    Ignorance and apathy have a price, elections have consequences.

    Comment by dscott — February 7, 2013 @ 3:20 pm

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