First Time Unemployment Drops Again… But…
Like many I look forward to seeing the unemployment numbers released by the Department of Labor each Thursday morning. These numbers reflect individual’s initial filing for unemployment benefits. They are not indicative of new jobs. Job growth numbers come out the first Friday of each month (I also watch for this). Dropping first time unemployment numbers coupled with increasing new jobs results in lowered unemployment.
Many experts agree that if the first time unemployed numbers drop to 350,000 it will be a sign of a growing economy. Listening to some of the news reports one might expect that magic number is just around the corner. Here are a few headlines from today’s report:
NEW YORK (CNNMoney) — Fewer Americans filed for their first week of unemployment benefits last week, but any glimmer of good news was cancelled out as the Labor Department also revised last week’s figure higher.
About 387,000 people filed new jobless claims in the week ended June 16, down from the previous week’s figure, which was revised up to 389,000, according to the Bureau of Labor Statistics.
USA Today — Weekly applications for unemployment aid fell 2,000 to a seasonally adjusted 387,000, the Labor Department said. That’s down from an upwardly revised 389,000.
WASHINGTON (AP) – The number of people seeking U.S. unemployment benefits dipped last week but not by enough to signal a better month of hiring in June.
Weekly applications for unemployment aid declined by 2,000 to a seasonally adjusted 387,000, the Labor Department said. That’s down from an upwardly revised 389,000.
MSNBC — Jobless claims edge lower, remain elevated
Did you notice anything unusual?
They all, or at least most, note that this week’s lower number is being compared to a ‘revised’ number from last week. It first, it may seem innocuous, but as reported in May, in 59 out of the past 60 weeks the unemployment number was revised UP. In other words, each week reporters stated that the new number was lower than the previous week. The initial numbers were always lower than the revisions. Isn’t that a statistical impossibility? How are these government estimators off the same direction each week? How many times can you flip a quarter and have it land on heads?
It is interesting to note that while the initial job numbers are big news each week the revisions rarely make headlines. So, what are we to make of this? Is our government purposely misleading citizens by underestimating numbers each week? Are they being more hopeful than realistic? Is this yet another political move geared toward the under-informed populous—those who catch the evening news and trust all that is reported?
What is for sure is that there are still too many companies laying off workers; too many skilled workers have taken part time or lower pay positions and too many workers who have given up and are no longer looking for jobs. The stimulus that promised to keep our employment under 8% may have staved off some government job cuts for a year or two but didn’t do much for the rest of us. We sure can use a jolt to the economy, something needs to change. And maybe then we’ll have some hope.