The Labor Department reported this morning that initial jobless claims jumped this week by 20,000, rising to 362,000. Economists had been expecting a slight increase to 355,000. The four-week moving average, a less volatile measure, also moved up to 360,000. The jobless claims number largely has been stuck in the 350-400,000 range since the Fall of 2011.
Initial jobless claims are a good proxy for the overall labor market, as they provide real-time data on layoffs and firings. Claims above 400,000 generally signal a contracting job market. Claims around the 300,000 level signal an expansion of hiring. The levels posted over the past year and a half suggest a stalled labor market.
Since the end of the recession, the economy has been unable to create the 250,000/month jobs necessary to keep pace with population growth. Last year, the economy added far less than that, averaging just around 183,000 jobs a month. This week’s report suggests the economy is still far from the job creation levels needed to ensure a strong recovery.
Of course, the media has been quick to put a positive spin on the disappointing news. In its news round-up, NPR called today’s report a “mid-winter blip” that wasn’t all that big of a deal. The “mid-winter blip”, though, has stretched on for years.