(Rachel Maddow Blog)
For the week ending May 26, the Department of Labor
reported Thursday, seasonally adjusted initial claims for unemployment insurance benefits rose to 383,000, 10,000 more than the previous week's revised figure of 373,000.
The four-week moving average, which analysts prefer because it flattens volatility in the weekly numbers, rose to 374,500, up from last week's 370,750.
For all programs, including the federal government's emergency extensions for states hardest hit by the Great Recession, the total number of people claiming benefits for the week ending May 12 was 6,137,862, a decrease of 30,753 from the previous week. Extended benefits were available in Alaska, California, Colorado, Connecticut, the District of Columbia, Florida, Idaho, Illinois, Nevada, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, Texas, and West Virginia during the week ending May 12.
Because of the February budget deal in Congress, more and more Americans who have been employed for nine months or longer will be losing their unemployment benefits from now until September because the number of weeks they are eligible to receive them is dropping from 99 to 73 in the hardest hit states. In low employment states, as few as 40 weeks will be available. Already, 409,000 have lost their benefits prematurely because of the deal. By the end of June, that total will reach nearly half a million.
The first-time claims figure released each week is an "advance" number, which is revised the following week when statistics are improved by better information from the states. For instance, the advance figure for the week ending May 19 was 370,000 and revised this week to 373,000. Over the past seven months, since Nov. 5, the revisions have been upward for 24 weeks and downward for five weeks. During that period, the average revision has been about 3 percent.
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Automated Data Processing's Job Report Discouraging
Analysts are looking toward Friday's monthly jobs report from the Bureau of Labor Statistics with deep concern. That's because the average net monthly job creation for the past three months has declined from 218,000 to 176,000, a 20 percent drop. In that light, this morning's announcement of private-sector job growth by Automated Data Processing is not a good omen. That figure was a seasonally adjusted 133,000, far below consensus expectations and only slightly better than ADP's report for April. The ADP numbers often don't mesh very closely with those in the BLS report, but they generally reflect the same up or down trend.
Employment in the private, service-providing sector increased a seasonally adjusted 132,000 in May, according to ADP, after rising 119,000 in April. Employment in the private, goods-producing sector rose 1,000 jobs in May. Manufacturing employment dropped 2,000 jobs, the second consecutive monthly loss. Construction jobs declined by 1,000, which was also the second consecutive monthly decline.
Said Joel Prakken, chairman of Macroeconomic Advisers, LLC, which carries out ADP's survey:
While May’s increase was the 28 consecutive monthly advance, it nonetheless reflected a notable slowdown in the recent pace of hiring. The sharpness of the deceleration seems consistent with other incoming data suggesting the economy, weighed down by heightened uncertainty over the European financial crisis and by growing concerns about domestic fiscal policy, slowed early in the year.
The modest rise in private employment suggests that the national unemployment rate probably did not decline in May unless the labor force continued to decline. Hence, today’s estimate, especially if reinforced by a weak reading on employment from the Bureau of Labor Statistics on Friday, likely will fuel concern that the economy is slowing fundamentally for the third summer in a row.
The BLS report will do much to shape perceptions of where the jobs market is headed for the rest of the year. The key question: Were the drops in March and April flukes or the onset of a new trend? Economists are forecasting the BLS will show that a seasonally adjusted 150,000 jobs were added to the economy in May.
Another weak showing would add to worries heightened by today's revised calculation for gross domestic product in the first quarter. GDP grew at an annual rate of just 1.9 percent for the first quarter of 2012, according to the Commerce Department. That's down from 3 percent the previous quarter. It's also down from the initial 2.2 percent GDP growth for the first quarter reported in April. A third and final revision will be released late in June. Revisions are based on more complete data that become available than is the case immediately after the quarter closes.
When measured from the income side the economy expanded at a 2.7 percent rate. Gross domestic income rose at a revised 2.6 percent pace in the fourth quarter, previously reported as a 4.4 percent rate. Real disposable personal income for the fourth quarter was revised down to a 0.2 percent growth rate from 1.7 percent.
For the first quarter, real disposable income rose 0.4 percent.
For millions of Americans hoping to get a job three years after the Great Recession was officially declared over, none of this is good news. And it can't be good news at 1600 Pennsylvania either with the election campaign now fully in gear. Republicans have done nothing to spark job creation, rather the opposite, and presidential nominee Mitt Romney was in the business of demolishing jobs when he was at Bain Capital. So there is no credibility there. But perception is what will matter to the voters. Although some four million private-sector jobs have been created on President Obama's watch, Republicans can be counted on to seize upon the slowdown in job creation at this crucial moment for campaign purposes.