In the week ending Nov. 7, the advance figure for seasonally adjusted initial claims was 502,000, a decrease of 12,000 from the previous week's revised figure of 514,000. The 4-week moving average was 519,750, a decrease of 4,500 from the previous week's revised average of 524,250.
Here is the relevant chart:
Here is a chart from the St. Louis Federal Reserve that shows the long-term trend for the 4-week average. This chart has not been updated with the latest reading:
This was the first piece of data that clued me into the fact that the recession was ending. The first time I noticed the continued decline in the 4-week moving average was maybe June(?) (there was a Barron's article that highlighted the trend). Since then the 4-week moving average has continued to move lower. Notice that the 4-week moving average is a good indicator for the end of a recession as evidenced from the previous recessions.
From NDD:
The 4 week moving average, at 519,750, is the lowest reading in a year, since the equal number on November 19, 2008. It appears the weekly jobless claims data are getting reading to test my hypothesis that net new jobs will be added if the jobless claims simply stay at this level for a few more weeks. In that regard, at the time of the 501,250 new jobless claims reading in 1990, payrolls lost 160,000 that month and 211,000 the next. In 2001, the new jobless claims high of 489,250 coincided with payroll losses of 325,000 that month and 292,000 the next. This year, we have already seen in August new jobless claims in the 560,000-570,000 range coinciding with a payroll loss of 151,000.
I have also surmised that, while Calculated Risk is correct that there will be little seasonal hiring this year, there will also be little seasonal firing this year either (believe it or not, layoffs increase dramatically as you move from September through New Year’s Day). Here is how the UNadjusted jobless claims look from their September lows through the first full week of November in the last 4 years:
2006: +86,500 weekly new claims
2007: +80,300 weekly new claims
2008: +203,100 weekly new claims
2009: +118,300 weekly new claims
In other words, so far my hypothesis is largely correct.
