Research
UI Claims Hover At 1 Million As Recovery Continues
Daniel Zhao
Chief Economist at Glassdoor | Aug 27, 2020
Initial unemployment insurance (UI) claims fell last week, but not enough to drop back below the 1 million mark. The blip in claims is a reminder that there's no guarantee that the recovery will progress uninterrupted, but weekly claims are still near intra-crisis lows. A brief detour is not enough to push us off the path to recovery.
Initial UI claims fell on a seasonally adjusted basis, dropping to 1.0 million from 1.1 million, according to the latest figures from the Department of Labor for the week ending Aug 22. Non-seasonally adjusted initial claims fell as well to 821,591, solidly below the Great Recession peak of 956,791 set in January 2009. 
Pandemic Unemployment Assistance (PUA) initial claims rose to 607,806, non-seasonally adjusted. PUA claims have risen over the last two weeks, despite falling rapidly over the month prior. PUA and UI claims combined have risen to 1.43 million, the highest level since the beginning of August.
Continuing claims for UI fell to 14.5 million for the week ending Aug 15, 2020, on a seasonally adjusted basis. Non-seasonally adjusted continuing claims dropped below 14 million for the first time since April, falling to 13.9 million. Continuing claims data for this week encompasses the reference week for the August jobs report. Continuing claims data presents a more optimistic view than other indicators, pointing to a faster improvement in the labor market in August than in July when job gains decelerated.
The Department of Labor also announced that next week, the weekly UI claims data would switch from a multiplicative seasonal adjustment to an additive one. That should help mitigate changes in the data from the seasonal adjustment alone that have produced improbable-looking swings during this abrupt crisis. Practically, this slightly reduces our expectations for seasonally-adjusted claims over the next few weeks, but doesn't fundamentally change our understanding of recovery.
While the recovery appears to be proceeding, it is progressing cautiously. The July jobs report showed a recovery decelerating from faster growth in May and June. Claims have fallen faster since mid-July, suggesting that the August jobs report could show a re-acceleration in the pace of recovery. However, other high-frequency indicators have pointed to a moderating recovery. Additionally, the expiration of the $600/week expanded unemployment benefits and slow implementation of the new $300/week benefits hang over the recovery. All of the economic factors currently in play possess the ability to impact the speed and velocity of the recovery’s current trajectory in the months ahead.
To speak with Daniel Zhao about today’s report or to discuss labor market trends, contact pr at Glassdoor dot com. For the latest economics and labor market updates, follow @danielbzhao on Twitter and subscribe to Glassdoor Economic Research.
Pandemic Unemployment Assistance (PUA) initial claims rose to 607,806, non-seasonally adjusted. PUA claims have risen over the last two weeks, despite falling rapidly over the month prior. PUA and UI claims combined have risen to 1.43 million, the highest level since the beginning of August.
Continuing claims for UI fell to 14.5 million for the week ending Aug 15, 2020, on a seasonally adjusted basis. Non-seasonally adjusted continuing claims dropped below 14 million for the first time since April, falling to 13.9 million. Continuing claims data for this week encompasses the reference week for the August jobs report. Continuing claims data presents a more optimistic view than other indicators, pointing to a faster improvement in the labor market in August than in July when job gains decelerated.
The Department of Labor also announced that next week, the weekly UI claims data would switch from a multiplicative seasonal adjustment to an additive one. That should help mitigate changes in the data from the seasonal adjustment alone that have produced improbable-looking swings during this abrupt crisis. Practically, this slightly reduces our expectations for seasonally-adjusted claims over the next few weeks, but doesn't fundamentally change our understanding of recovery.
While the recovery appears to be proceeding, it is progressing cautiously. The July jobs report showed a recovery decelerating from faster growth in May and June. Claims have fallen faster since mid-July, suggesting that the August jobs report could show a re-acceleration in the pace of recovery. However, other high-frequency indicators have pointed to a moderating recovery. Additionally, the expiration of the $600/week expanded unemployment benefits and slow implementation of the new $300/week benefits hang over the recovery. All of the economic factors currently in play possess the ability to impact the speed and velocity of the recovery’s current trajectory in the months ahead.
To speak with Daniel Zhao about today’s report or to discuss labor market trends, contact pr at Glassdoor dot com. For the latest economics and labor market updates, follow @danielbzhao on Twitter and subscribe to Glassdoor Economic Research.Daniel Zhao
Daniel Zhao is Chief Economist at Glassdoor. On Glassdoor's Economic Research team, he has conducted research using Glassdoor's unique data on a variety of topics affecting job seekers and employers ranging from the health of the job market to pay transparency to employee engagement & retention. His work has been cited in publications like the New York Times, the Harvard Business Review and more. Prior to joining the Economic Research team, he also worked on improving the user experience for Glassdoor’s consumer jobs product and mobile app. He holds a bachelor's degree in applied mathematics and economics from Harvard College.
Tags:Unemployment
