Wednesday, July 8, 2009

On Unemployment Exhaustion

Several people have commented that unemployment data should be coordinated with unemployment exhaustion rates. Fair enough.

The information is from the department of labor. Unfortunately, they use a flashbook format which I can't copy. So here is the link:

Use data batch number 7.

The information is important for several reason:

1.) Unemployment exhaustion is currently at an all-time high. This is the point people think is important (which it is).


Coordinate the DOL data with NBER business cycle data found here:

Notice that spike in exhaustion rates typically happen at the end of recessions.

That jibes with information found in this post where I note the 4-week moving average is moving lower, the Challenger job cuts report is dropping and the seasonally adjusted mass lay-offs are dropping.

Let me add this: I am not saying it's good that unemployment benefits are ending, nor am I saying anyone who has lost benefits can go to hell. I am not saying that in any way, shape, or form. These people need an extension of benefits.

However what I am saying is this is another data point that indicates we're probably near the end of a recession.