economic indicators

Wow. Am I confused.

The number of people filing first-time claims for unemployment is now at the level before the pandemic started.

For the week ending 12/4/21 there were 184,000 new claims. The four-week average is 219,000 which is almost a match to the average of 212,000 average in January and February 2020.

The number of people drawing unemployment insurance is 1.99 million which shows a continual decline and is approaching the 1.72 million average before the pandemic.

Yet the civilian labor force is still 2 million below the start of the pandemic and the number of people not in the labor force is 5 million higher. Everywhere you look you see help wanted signs and in my tiny corner of the world I have seen restaurants cutting back service or closing in the middle of the workday. Everywhere you look you read about a massive shortage of staff.

Part of the explanation for this confusing picture is common to read about the surprisingly low number of new claims. Speculation in several articles I read is this reflects employers being very hesitant to let go of workers if they think they will be unable to find new staff if needed in the near-term.

For example, consider this report:

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First-time claims for unemployment now below the level when the pandemic started. Ongoing claims for unemployment continuing to decline as of the end of November 2021.Read More »

The Personal Consumption Expenditure (PCE) inflation index increased 0.6% October 2021.  This is a jump from the 0.4% in July, August, and September.  The 0.6% matches the increase in March and April.

The core PCE inflation rate was 0.4% in October which is in the middle of the range from March 2021 through September.

This indicates inflation is continuing and perhaps accelerating.

The cumulative 12 month change, according to BEA, has risen to 5.0% for the 12 months through October 2021, compared to 4.2% for the 12 months ending September.

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Personal Consumption Expenditure for September 2021 shows high inflation rate is continuing.Read More »

The number of new claims for unemployment is slowly declining.

For the week ending 11/6/21 there were 267,000 new claims. While this is encouraging progress, keep in mind the number of people who are getting laid off is still far above the average of 212,000 per week all the way back in January and February 2020. We are still seeing more people laid off every week than before the pandemic began.

Here is a recap of newly unemployed over the last several months:

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Number of people drawing unemployment continues to improve, but very slowly, as of the start of November 2021.Read More »

The Personal Consumption Expenditure (PCE) inflation index shows an increase of 0.4% in July 2021. Since December 2020 this index is shown inflation of between 0.3% and 0.6% each month.

This indicates that inflation is continuing. Good news is that inflation is not accelerating. Bad news is an annualized inflation rate of about 6% is continuing.

The PCE is the inflation index preferred by the US Federal Reserve. An intriguing aspect of the PCE is the numbers are routinely revised. This means prior month’s numbers will shift, sometimes by substantial amounts.

Update: The year over year change in PCE is 3.6%. CNBC reports on 8/28/31 Key inflation gauge rises 3.6% from a year ago to tie biggest jump since the early 1990s. To be specific that matches the increase in May 1991 and is second only to the 4.2% increase in January 1991. Current policies of the White House and Congress have given us the highest inflation in 30 years. Not yet Carter era bad, but there is time to achieve Carter level performance.

The CNBC article also says some of the Fed members are starting to see the immediate inflation just might be more than just a temporary adjustment to the economic shutdown. President of the Atlanta Fed acknowledge such possibility when he said on-air that he is hearing from a many of his business contacts that they expect inflation go to beyond the immediate-term.

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Personal Consumption Expenditure for July 2021 shows increased inflation is still in play.Read More »

New claims for unemployment are down about 60,000 per week since my last post 10 weeks ago. For the week ending 8/21/21 new claims were 353K compared to 412K the week of 6/12/21.

The number of insured unemployed has dropped more substantially, from 3.53M the week ending 6/12/21 to 2.9M the week ending 8/14/21. That is a drop of 672K over nine weeks. For contrast the number of insured unemployed was averaging 1.7M in January and February 2020.

Those numbers reveal a slow improvement although the number of people losing their jobs each week is still running double the average in January and February 2020.

Purpose of these posts on economic statistics is to help all of us keep current on what is going on in the overall economy.

What I’m drawing from the data is the economy is improving one little bit at a time. Seems to me the recovery is slowing.

Revised number of weekly new claims in state programs over recent months shows following trend:

• 406K – 5/22/21
• 412K – 6/12/21
• 368K – 7/10/21
• 349K – 8/14/21

Following graphs show the devastation from the economic shutdown.

New claims

New claims for unemployment by week since the start of 2020:

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Very slow but steady improvement in unemployment as of early August 2021.Read More »

It isn’t just the current numbers that are hinting that inflation is back. Changes in CPI and PCE are unsettling.

There is also a clear statement from the Fed they will nudge interest rates up earlier than they previous announced. Also indications from two big banks that we will see rising interest rates.

6/17/21 – Dailywire – Federal Reserve Delivers Bad News About Expectations For Inflation, Raising Interest Rates: Report – Previously the Federal Reserve indicated interest rates would not have to be increased until sometime in 2024.

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Expectations growing that we will see rising interest rates and sustained inflation.Read More »

New claims for unemployment are flat compared to three weeks ago. Ongoing claims for unemployment at the state and federal level are declining, slow though the decline may be.

Number of weekly new claims for unemployment was 406,000 three weeks ago and 412,000 the most recent week. The increase in the most recent week offset the decline in the previous two weeks.

Most recent data shows ongoing claims at the state level dropped from 3,602,000 three weeks ago to 3,518,000 in the most recent week, for a net decrease of 84,000. There was an increase two weeks ago, large drop last week, and essentially no change this week.

The number of new claims is still double the average from before the pandemic.

Purpose of these posts on economic statistics is to help all of us keep current on what is going on in the overall economy.

Revised number of weekly new claims in state programs over the last four months to show the trend:

• 728K – 3/27/221
• 590K – 4/24/21
• 406K – 5/22/21
• 412K – 6/12/21

Following graphs show the devastation from the economic shutdown.

New claims

New claims for unemployment by week since the start of 2020:

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New claims for unemployment are flat and ongoing claims are slowly decreasing as of middle of June 2021.Read More »