Unemployment Rate rises to 8.9%

According to "The Employment Situation" for April 2009, released today by the U.S. Department of Labor, seasonally adjusted, the unemployment rate was 8.9%, up from 8.5% in March and 5.0% a year ago. The unemployment rate is now up 3.5 percentage points in the last twelve months and is up 4.1 percentage points from its recent low of 4.4%. Nonfarm payrolls decreased by 539,000 in April down from a revised 699,000 in March.  This month they revised the previous two months of March and February downward by 66,000 jobs. Last month, the total jobs lost from December 2007 to March 2009 was reported to be 5,133,000. This month, with the revisions, the total jobs lost from December 2007 to April 2009 has reached 5,738,000 jobs. The average recession since World War II has had a loss of 1,917,000 job.  The biggest loss before this recession came in 1982 with 2,838,000 jobs lost. In terms of job loss, we are in the biggest recession since the Great Depression.

The U.S. Department of Labor released the Weekly Claims data for Unemployment Insurance yesterday. Initial claims were at 601,000 for the week ending May 2. This is down from the previous week's number of 635,000. The four week average of initial claims, which is not as volatile, was at 623,500. This is down from the previous week's figure of 638,250. Continued claims for unemployment insurance increased to 6,351,000 for the week ending April 25th up from the previous week's number of 6,295,000. The four week average for continued claims was also up to 6,207,000 from 6,082,000. This is the highest continued claims has ever been. The previous high was in 1982. Initial claims is faster to move up and signals increases in the unemployment rate. Continued claims take longer to go down than the initial claims once the unemployment rate is elevated. The Unemployment rate doesn't drop until continued claims start to come down.

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