December 12, 2013

Initial Unemployment Claims (121213): 368K SA; Raw Claims 7.5% Higher Than Same Week Last Year

Filed under: Economy,Taxes & Government — Tom @ 8:22 am

Predictions:

Seasonal adjustment factors:

  • Week ended Dec. 7, 2013 — 125.4
  • Week ended Dec. 8, 2012 — 121.4

Raw Claims:

  • Week ended Nov. 30, 2013 — 315,181 (this is about 1,200 higher than a week ago; the revision is already reflected in DOL’s detailed tables)
  • Week ended Dec. 8, 2012 — 429,188

For the Business Insider prediction to come true, raw claims will need to be 401,000 or lower (401K divided by 125.4 is 320K, rounded).

It seems like the bar is pretty low and that seasonally adjusted claims should come in at about 300,000, which would mean 376,000 raw claims. 280,000 should not be out of the question.

If seasonally adjusted claims are higher than 320,000, that will be a very negative sign, given the number of raw claims which would generate that result.

The report will be here at 8:30.

HERE IT IS (permanent link) — Holy … moly:

SEASONALLY ADJUSTED DATA

In the week ending December 7, the advance figure for seasonally adjusted initial claims was 368,000, an increase of 68,000 from the previous week’s revised figure of 300,000. The 4-week moving average was 328,750, an increase of 6,000 from the previous week’s revised average of 322,750.

… UNADJUSTED DATA

The advance number of actual initial claims under state programs, unadjusted, totaled 461,422 in the week ending December 7, an increase of 146,241 from the previous week. There were 429,188 initial claims in the comparable week in 2012.

Though this week’s result could conceivably be a one-off, I don’t think so. I think it’s the result of a very weak opening to the Christmas shopping season possibly (emphasis possibly) combined with some Obamacare economic chickens finally coming home to roost.

The raw claims number is absolutely awful. The fact that the previous week was Thanksgiving and that there was a lot of spillover into this week is going to be used as an excuse. But there’s no way that’s responsible for all of the 145,000 one-week jump in raw claims (see comparies to 2012 below) — and this year’s seasonal adjustment factor was about 3.3 percent higher than 2012 to supposedly make up for that quirk (Thanksgiving 2012 was two weeks earlier).

The markets, which had a bad day yesterday because of fears of tapering, will probably be thrilled. That’s how upside-down things are these days.

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UPDATE: Let’s look at the past three weeks’ raw claims compared to last year’s same three weeks, as that will include both years’ Thanksgivings:

  • 2013 — 1.154 million
  • 2012 — 1.288 million

So 2013 is still below 2012 by about 11%. Some will point to a similar post-Thanksgiving surge last year, but in percentage terms (39%) it wasn’t as big as this year’s surge (46%).

UPDATE 2: Zero Hedge — “… this is the biggest spike ex-Sandy in the all-important initial claims data since 2005.” Also: “… the Labor department says no states were estimated.”

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3 Comments

  1. Good news – retail sales for November were up 0.7% (0.6% ex-energy/food).

    Bad news – A lot of employers waited until after Turkey Day to do their firings. Average the past 2 weeks out and we’re right back at 325K/week.

    Comment by steveegg — December 12, 2013 @ 8:33 am

  2. Could this be explained mostly by the switch from brick and mortar shopping to on line shopping? Accounting for retail sales up but seasonal hiring down? As retailers are forced to become more labor adverse due to ObamaCare, they are pushing their sales more to mail order than the showroom? Walmart has been pushing their website as an alternative to the store to compete with Amazon.com.

    Comment by dscott — December 12, 2013 @ 2:44 pm

  3. I think retailers are trying to push as much as they can to online without alientating customers who want to see-touch-feel, and that Ocare is to an extent now and will in the future even more is drive that trend to go faster than it might have otherwise.

    Comment by Tom — December 13, 2013 @ 6:28 am

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