When watching for the recovery, continuing jobless claims are key
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The Labor Department reported Thursday that another 2.4 million people filed for unemployment benefits last week. That’s down from the week before, but still about the population of Houston. There are a couple of ways the government measures unemployment filings. Initial jobless claims — what we got today — and the number of overall continuing claims. The difference between the two matters.
Initial jobless claims are how many new people file for unemployment benefits in a week. Continuing claims measure the total number of workers on unemployment. Cornell economist Erica Groshen said to think of it like a bathtub.
“The initial claims is how much water is flowing into the bathtub, and the continuing claims is how much water is in the bathtub,” Groshen said.
Each number is important. Chris Rupkey, chief financial economist at the global financial group MUFG, follows both.
“Well, that’s why God gave us two eyes. You have to watch both,” he said.
But Rupkey said when he wants to tease out underlying trends, the continuing claims number is more important.
“Because the minute the total number of people receiving unemployment starts to come down, that’s the key signal that the labor market’s improving,” he said.
The continuing jobless claims numbers will play a key role in whether the post-coronavirus recovery looks like a “V” or “U” — meaning the economy improves quickly — or is flatter, like an “L.” Dartmouth College economist Patricia Anderson will be watching that.
“If the continuing claims start falling fairly rapidly, that’s a good sign that we might be more U-shaped than L-shaped,” she said.
If the continuing jobless claims keep plodding along at about the same rate, Anderson said that’s not a sign that we’re really turning the corner.
COVID-19 Economy FAQs
What’s going on with extra COVID-19 unemployment benefits?
The latest: President Donald Trump signed an executive action directing $400 extra a week in unemployment benefits. But will that aid actually reach people? It’s still unclear. Trump directed federal agencies to send $300 dollars in weekly aid, taken from the federal disaster relief fund, and called on states to provide an additional $100. But states’ budgets are stretched thin as it is.
What’s the latest on evictions?
For millions of Americans, things are looking grim. Unemployment is high, and pandemic eviction moratoriums have expired in states across the country. And as many people already know, eviction is something that can haunt a person’s life for years. For instance, getting evicted can make it hard to rent again. And that can lead to spiraling poverty.
Which retailers are requiring that people wear masks when shopping? And how are they enforcing those rules?
Walmart, Target, Lowe’s, CVS, Home Depot, Costco — they all have policies that say shoppers are required to wear a mask. When an employee confronts a customer who refuses, the interaction can spin out of control, so many of these retailers are telling their workers to not enforce these mandates. But, just having them will actually get more people to wear masks.
You can find answers to more questions on unemployment benefits and COVID-19 here.
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