New Claims for Unemployment Insurance Remain Elevated
Unemployment insurance claims were over 400,000 for the fifth week in a row. There were 434,000 claims last week, and the elevated claims ought to be raising cautionary flags about the labor market recovery. We keep hearing that recovery is just around the corner, and all that is needed is more patience, but recent numbers don't support this optimism.
Whenever the data is at odds with the rosy predictions of good days ahead, predictions that take policymakers off the hook, we hear about problems with seasonal adjustment, holidays that distort the numbers, bad weather, etc., etc. -- there's always a reason to ignore the bad numbers and emphasize the good and this week is no exception. But after five months of elevated claims in a row, middling job creation numbers, and an unemployment rate that is far, far too high, it's time to quit looking for rationalizations, face the weakness in labor markets directly, and then take the necessary action.
Unfortunately, there's little chance that politicians will actually try to do something to help. In fact, if they could they'd make the employment problem worse by cutting the budget before the economy is on solid footing. So the best we can hope for at this point is that gridlock will stop politicians from doing things that make it even harder for the unemployed to find a job.
