Contraction in the jobs market is becoming more severe, the latest evidence from weekly jobless claims that is certain to deepen concern over the depth of the recession. Comparisons in the series have shifted to highs not seen since the 2001 recession to highs not seen since prior recessions in the early 90s and early 80s. First-time jobless claims jumped nearly 30,000 to 542,000 for the highest level since 1992. There are no special factors to explain the jump though the Nov. 15 reporting week is a holiday shortened week (Veterans Day). The four-week average, at 506,500 for a 15,750 gain, is at its highest since 1983. Trouble is confirmed by continuing claims which indicate those already out of a job are having trouble finding a new job. Continuing claims for the Nov. 8 week jumped 109,000 to 4.012 million, the highest since 1982.
A week-to-week comparison with the mid-month survey week for the household employment report shows a 63,000 rise for initial claims and a 26,000 jump for the four-week average. October's employment report showed a big jump in the unemployment rate and a deep contraction in payrolls, conditions that may be getting worse in November based on unemployment claims. Stock futures slipped as did the dollar in reaction to the report while money moved deeper into the safety of Treasuries.
Market Consensus Before Announcement
Initial jobless claims for the November 8 week jumped 32,000 to 516,000 for a seven-year high. There now is no doubt that the labor market is in a full-fledged recession. Not only are new claims spiking, but those already picking up unemployment checks are having difficulty finding a new job. Continuing claims for the November 1 week jumped 65,000 to 3.897 million for a 25-year high. These trends are likely to continue or worsen as recent manufacturing surveys point to worsening employment conditions.
Jobless Claims Consensus Forecast for 11/15/08: 505,000
Range: 480,000 to 525,000 |
