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First Cut: In June 6 week, claims levels recede further but still skyhigh

The unadjusted level of initial jobless claims was down 82,886 to 1.537 million in the week ended June 6. Unadjusted claims have not declined for a ninth straight week. However, while the number of claims being filed are coming down, the level is still sky-high. The labor market struggling as businesses exhaust available resources and are forced to lay off workers. Since the start of the impacts from the COVID-19 pandemic on claims data in the March 21 week, the number of unadjusted claims totaled 40.376 million. Applications may be slowing due to Federal government relief efforts – primarily the Paycheck Protection Program (PPP) which has been increased in size and reach after the first availability proved inadequate to demand.

I continue to cite the unadjusted data in favor of the seasonally adjusted numbers. Seasonal adjustment simply makes no sense while claims are well outside and above any other period in the series history.

The Labor Department mentioned no special factors beyond the COVID-19 pandemic. Only Michigan estimated claims in the week.

Ongoing claims were down 178,671 to 18.920 million in the May 30 week as some workers were recalled as local governments opened up activity around the Memorial Day holiday and others were covered by the PPP and returned to payrolls. The unadjusted insured rate of unemployment dipped a tenth to 13.0% in the May 30 week. It is below recent highs but still well above previous periods of recession.

Pandemic Unemployment Assistance (PUA) benefits initial claims – intended to cover those not eligible for regular unemployment benefits – were down 91,137 to 705,676 in the June 6 week. Levels of applications and recipients are ebbing as the program’s deadlines and limits are reached.

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