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Obama Recession Begins? Unemployment Claims Escalate
Raymond Richman, 1/15/2013

The number of actual initial claims for unemployment insurance totaled 552,043 in the week ending January 5, an increase of 61,944 from the previous week. The press did not report this figure. Instead, they reported a figure of 371,000, a figure 181,043 lower. The 371,000 figure was the advance figure for seasonally adjusted initial claims, an increase of only 4,000 from the previous week's revised figure of 367,000. To be charitable to the media, 371,000 was the figure headlined by the Bureau of Labor Statistics of the US Department of Labor when announcing the availability of its weekly report.  But it is apparent that the media reported the data without reading the first page of the report.

CNBC's Rick Santelli breaks down the numbers on unemployment and discusses what it indicates about the nation's jobs market with CNBC's economist Steve Liesman. Both appear completely unaware of the actual number of unemployment insurance claims and took it as evidence of some stability in the labor market. 

The figures "continue to suggest steady but modest U.S. employment gains", Robert Kavcic, senior economist at BMO Capital Markets, said in a note to clients.  To the contrary,  the unadjusted figures suggest serious U.S. employment losses. Weekly applications are a proxy for layoffs.  The seasonally adjusted figures have fluctuated for most of the past 12 months between 360,000 and 390,000. Until October, 2012, the actual figures ranged similarly in the first ten months of 2012 but beginning in October they escalated from 360,000 to the latest report figure of 543,000, which ought to have created concern. Here are the unadjusted actual claims for the year.   

NOT SEASONALLY ADJUSTED (Source: Federal Reserve Bank of St Louis)

2012-08-04   320219

2012-08-11   317680

2012-08-18   311857

2012-08-25   312542

2012-09-01   309537

2012-09-08   299729

2012-09-15   330454

2012-09-22   303685

2012-09-29   301054

2012-10-06   329919

2012-10-13   362730

2012-10-20   345226

2012-10-27   339917

2012-11-03   361800

2012-11-10   478543

2012-11-17   403637

2012-11-24   358869

2012-12-01   500163

2012-12-08   429188

2012-12-15   401429

2012-12-22   45683?

2012-12-29   490099

2013-01-05   552043

In contradiction to this data, the Department of Labor announced that employers added 155,000 jobs in December, while the unemployment rate remained 7.8 percent. The gain in hiring, it reported, nearly matched the average of 153,000 jobs per month in 2011 and 2012. That's just been enough to slowly push down the unemployment rate, which fell 0.7 percentage points in 2012.

Maybe so, but employers appeared to dislike the results of the national election. And the poor results of the seasonal Christmas business seems to accord with what was really happening in the labor market. We do not pretend to know why unemployment increased in November and December but the timing suggests employer unhappiness with the election results. 

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The  reader may want to compare the unadjusted data with the seasonally adjusted figures below:

SEASONALLY ADJUSTED

012-08-04  364000

2012-08-11  369000

2012-08-18  374000

2012-08-25  377000

2012-09-01  367000

2012-09-08  385000

2012-09-15  385000

2012-09-22  363000

2012-09-29  369000

2012-10-06  342000

2012-10-13  392000

2012-10-20  372000

2012-10-27  363000

2012-11-03  361000

2012-11-10  451000

2012-11-17  416000

2012-11-24  395000

2012-12-01  371000

2012-12-08  344000

2012-12-15  362000

2012-12-22  363000

2012-12-29  367000

2013-01-05  371000

2012-12-08  344000

2012-12-15  362000

2012-12-22  363000

2012-12-29  367000

2013-01-05  371000