[Sixstrings]

New U.S. claims for unemployment benefits unexpectedly rose last week to the highest level since early April, highlighting a weak labor market and the fragile economic recovery.

Initial claims for state unemployment benefits rose 19,000 to a seasonally adjusted 479,000, the Labor Department said on Thursday. That compared to market expectations for a drop to 455,000.
http://www.cnbc.com/id/38572868

Wow, this is just so unexpected!

In other news, food stamp usage unexpectedly rose 19% over the last year and unexpectedly continues to get worse each month:

WASHINGTON — The number of Americans who are receiving food stamps rose to a record 40.8 million in May as the jobless rate hovered near a 27-year high, the government reported yesterday.

Recipients of Supplemental Nutrition Assistance Program subsidies for food purchases jumped 19 percent from a year earlier and increased 0.9 percent from April, the US Department of Agriculture said in a statement on its website.

Participation has set records for 18 straight months.
http://www.boston.com/news/nation/washington/articles/2010/08/05/food_stamp_use_hit_record_408m_in_may/

[TreeFarmer]

It seems that unemployment benefits end, or at least seem to end, at 99 weeks. Also, people are able to drop off of the unemployment rolls if they are not actively seeking work. However, they still have to eat so perhaps the food stamp roll is a good measure of what is going on in the country.

TF

[eXpat]

Ohhhhhhh! What a surprise!!! The only one surprised by this is Oily and maybe his herd of cornys

[the48thronin]

next all of the above and more!

[copious.abundance]

8O Ohhhhhhh! What a surprise!!! The only one surprised by this is Oily and maybe his herd of cornys

Actually, I'm not surprised one bit. If you read what I wrote here (5th post from top, the one beginning with "I have an important announcement to make"), you'll see that I wrote on June 17:

Initial unemployment claims are basically going to go sideways for the next ~2 years. They might decline, but it will be small and gradual.

Since then they've done exactly what I've predicted - go sideways.

They've gone sideways the entire year. Based on historical precedent (read link above), I don't expect them to go much anywhere at all for a while.

[Sixstrings]

Initial unemployment claims are basically going to go sideways for the next ~2 years. They might decline, but it will be small and gradual.

Uh-oh.. when a cornucopian says things are heading "sideways" for a few years, it must really be bad.

[copious.abundance]

^
Actually, it's not necessarily "bad" - though to be sure it could be better. If you look at the history of unemployment claims, you'll discover they typically peak at some point during a recession, then decline pretty rapidly (as they did for the last 2/3 of last year), then at some point around 1/4-1/2 the way down from the peak, they hit a brick wall and go sideways for quite a while. Sometimes they even go back up a bit.

This time around, by New Years they had fallen about 1/3 the way down from their peak, and have gone sideways ever since. So, what's happening is fairly typical.

[Sixstrings]

This time around, by New Years they had fallen about 1/3 the way down from their peak, and have gone sideways ever since. So, what's happening is fairly typical.

Yep, fairly typical in that after each successive "recovery," the American worker winds up more screwed than before. The "recovery" in the Bush years was a lot of McJobs type service sector stuff -- do you see that happening again, like new Bed Bath & Beyond chains and Starbucks everywhere?

I just don't see it. The McService jobs and consumer credit to infinity and beyond were the last "recovery," now we ain't got nothin'.

[copious.abundance]

^
Believe it or not, but retail wasn't a big job-growth sector in the 00's. Here's a bit of info:
http://www.nrf.com/modules.php?name=Pages&sp_id=1243

From 1998 to 2008, retailing added almost 750,000 jobs to the U.S. economy, contributing to U.S. job growth.

750K / 10 years / 12 months = 6,250 additional jobs/month. That's not much.

IIRC, the biggest job growth area was health care, as was business and professional services.

[Sixstrings]

Believe it or not, but retail wasn't a big job-growth sector in the 00's.

So now that you've made this "sideways" call for next few years, are you going to change your avatar? "Sideways for years" doesn't sound like Abundance, Prosperity, and Cornucopia to me.

[copious.abundance]

^
During the previous episodes of sideways initial jobless claims, there had still been job and GDP growth. In fact, typically when jobless claims first had hit the sideways pattern was when overall job growth transitioned from negative to positive. I'm not sure of the reason for that, but that's the way it tends to behave.

I'll do a little academic exercize here, just for the heck of it.

My "favorite" parallel to the recent recession was the 1974-75 recession and subsequent recovery.

Go here and select 1973-1978 for the years:
http://www.economagic.com/em-cgi/charte ... /day-icusa
^
Notice that initial jobless claims peaked early in '75, then hit the wall I was speaking of at the beginning of '76. They even went up a bit during '76, but in general went sideways for 3 years.

So, what else happened to the economy from 1976-78? Was everything doom and gloom just because jobless claims went sideways?

No, we actually had a decent recovery during that time.

For GDP growth, go here and select 1976-78:
http://www.bea.gov/national/nipaweb/Tab ... 0&Freq=Qtr
^
The results were:
Q1 1976: +9.4%
Q2 1976: +3.0%
Q3 1976: +2.0%
Q4 1976: +2.9%
Q1 1977: +4.7%
Q2 1977: +8.2%
Q3 1977: +7.3%
Q4 1977: -0.1%
Q1 1978: +1.4%
Q2 1978: +16.7% (!!!)
Q3 1978: +4.0%
Q4 1978: +5.4%

Not bad! For payroll growth, go here and again select 1976-78. Here are the results:

1/76: +489K new jobs
2/76: +311K
3/76: +232K
4/76: +244K
5/76: +18K
6/76: +65K
7/76: +170K
8/76: +158K
9/76: +188K
10/76: +13K
11/76: +332K
12/76: +211K

1/77: +244K new jobs
2/77: +295K
3/77: +404K
4/77: +339K
5/77: +359K
6/77: +399K
7/77: +348K
8/77: +238K
9/77: +458K
10/77: +262K
11/77: +379K
12/77: +235K

1/78: +187K new jobs
2/78: +353K
3/78: +513K
4/78: +702K
5/78: +346K
6/78: +442K
7/78: +254K
8/78: +276K
9/78: +137K
10/78: +336K
11/78: +437K
12/78: +283K

Sorry for taking up so much room, but as you can see, again, this isn't bad at all! You've got a soft spot in the middle of '76, but other than that it was pretty good.

Point being, just because jobless claims go sideways for 3 years, does not mean the economy is doing bad.

[TWilliam]

Point being, just because jobless claims go sideways for 3 years, does not mean the economy is doing bad.

Except perhaps when you're one of those 'jobless' folk...

[Sixstrings]

Point being, just because jobless claims go sideways for 3 years, does not mean the economy is doing bad.

Except perhaps when you're one of those 'jobless' folk...

They're not jobless folk Tyler, they're "sideways" folk. Actually Oilfinder might be onto something here.. whenever bad economic data comes out, just turn your head to the side and squint sort of funny and then it all looks sideways instead of down.

Seriously though.. I hope Oilfinder gets back to Cornocupia. This is a little unsettling, cornies turning doomer.

EDIT: And as for those job number gains from the 70's, he's comparing apples to oranges. We had about 150 million LESS people in the 70s. So to see the same effect now you'd have to double all those numbers Oilfinder posted.

And besides, forget adding jobs we're now LOSING jobs again (-131,000 in July). But I guess that's just more sideways action, and in three years Oilfinder will be right and the US will have a surge of employment from some mystery industry that won't be offshored to Chindia.

[evilgenius]

One problem with looking at past payroll growth is that benefits have been included in that figure. Americans have been handed no significant real increases in pay measured as actual pay, but instead increases measured as pay and benefits. The good thing about this is that at least the health care sector remains afloat this far into such a bad time. The bad part is that in order for your average American to 'keep up with the Joneses' they had to go into debt to do it because their actual pay was not adequate. If the inflation fighters at the Fed had been just a little bit more on the side of workers during the last forty years the situation might be a little different, but it is what it is. There is not enough surplus investment out there to get anything started in the private sector. Innovators are going to have to find whole new ways of not just marketing, but of financing and risk taking in order to get any kind of cell activity started that will take. Americans have been very familiar with innovation, enough to make a go of it I think. What I worry about is the lack of skill that has developed in the general populace as real skill has migrated to concentration rather than diffusion in society and society, in general, has chosen to embrace an anti-elitist stance for cultural and coping reasons.

[Ludi]

society, in general, has chosen to embrace an anti-elitist stance for cultural and coping reasons.

The "elite" top 2% of US earners have gained the most increase in wealth - the top 1% more wealth than any group in history. Why are they not investing in innovation? Why are THEY being "anti-elitist" when they are themselves the elite?

[Sixstrings]

You have failed miserably. When will you give it up?

He already has. Saying that the economy will be "sideways for the next 3 years" essentially relieves him of having to carry the Cornucopian banner through 2013. By which time we'll probably all be gone from this forum, so this "sideways" statement is likely the closest admission of Doom we'll ever see from Oilfinder.

[MarkJ]

One problem with looking at past payroll growth is that benefits have been included in that figure. Americans have been handed no significant real increases in pay measured as actual pay, but instead increases measured as pay and benefits.

When I was looking for a residential/commercial HVAC/R design/installation/service job when I was younger, pay was good, but benefits and perks weren't too great.

Some of the companies that offered minimal benefits when I was in my 20s, now offer top performers medical, dental, vision, life, profit sharing, tuition reimbursement, incentives, bonuses, commissions, longer paid vacations, more paid sick/personal days, company vehicles, bigger employee discounts.

Many jobs now have a modest base pay, but higher performance based pay for exceeding engineered labor standards, or commissions, bonuses, incentives and other perks.


Working conditions are much better in many industries as well. Many workers that used to sweat their a$$es of now work in air conditioned offices, warehouses and factories. Safety is much better as well due to automation, robotics, computerization, tougher safety codes/enforcement, employee lawsuits, tougher pre-employment, probationary and post employment standards, engineered labor/safety standards etc.

When locals worked in the mills, factories and tanneries, working conditions were poor, deaths, serious injuries and accidents were common, plus many later had health issues, or died due to exposure to chemicals, toxins etc.

Currently many employers are much quicker to suspend, re-train, or terminate poor performers and unsafe workers, so the workplace is safer, plus there are much fewer unproductive workers, so we have fewer productive workers that have to carry the slackers.

[Ludi]

Working conditions are much better in many industries as well.

Generally due to government interference (OSHA) and unions. Not because employers decided to be nice.