Blog Jobs -- July 9, 2015

This is always the most interesting data point of the week. More precisely, the data point is less interesting than the spin. So, let's see the spin today. From Reuters, the headline, not much spin: U.S. jobless claims rise to highest level since February:

New applications for U.S. unemployment insurance benefits rose last week to their highest level since February, suggesting some slowdown in the labor market recovery.

Initial claims for state unemployment benefits rose 15,000 to a seasonally adjusted 297,000 for the week that ended July 4, the U.S. Department of Labor said on Thursday.

You don't have to read far to get the spin. The very next paragraph:

Even with the rise in claims, the latest report marks the 18th consecutive week of new filings below 300,000, which is considered consistent with a firming labor market.  

The previous week's report was revised upward 1,000 to 282,000. 

But the story is actually worse; economists had expected new applications to fall to 275,000 last week. So, again, not only did applications fall as expected, but they surged. A jump of 15,000 new applications (as well as an upward revision of the previous week's number) is not trivial, especially after a gazillion dollars in stimulus and six years into the Obama recovery.

I assume the layoffs in the oil and gas industry are starting to be seen. 

More from the linked article:

Continued claims - the number of people still claiming jobless benefits after an initial week of aid - rose 69,000 to 2.334 million in the week ended June 27.

Oh, this is interesting. When did this change? When I was growing up, 4% unemployment was always considered "full employment." It appears like many definitions that have been changed under President Obama, the definition of full employment has also changed. From the linked article (I cannot make this stuff up): 

The labor market has been tightening, with the unemployment rate not too far from the 5.0 percent to 5.2 percent range that most Federal Reserve officials consider consistent with full employment. 

Regardless of changing definitions by the Obama administration, I maintain that an unemployment rate of 8% today is equivalent to 4% when I was growing up, with the safety net, the underground economy, and the technology shift. 

Finally, the standard boiler plate continues:

The four-week moving average of claims, which smoothes (sic) out week-to-week fluctuations and is therefore considered a better gauge of the labor market, rose 4,500 to 279,500 last week.

With regard to "smoothes" -- check out this site: http://english.stackexchange.com/questions/103422/smooths-versus-smoothes.

I assume over time "aks" will be the accepted form of "ask." 

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A Trifecta

For those paying attention, these are the initial claims numbers for the past three weeks, during the summer hiring season, after a gazillion dollars in stimulus, and six years into the Obama recovery.

July 9, 2015: claims surge 15,000 to 297,000 (previous week was revised upward by 1,000); four-week average rose 4,500 to 279,500.  

July 2, 2015: claims surge 10,000 to 281,000; a 5-week high; four-week average increases by 1,000 to 274,750.

June 25, 2015: claims rise 3,000 to 271,000; four-week average falls 3,250 to 273,750.

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Were The Goalposts Moved?

Back to "full employment." Wiki is not particularly helpful to determine whether President Obama has moved the goal posts. Wiki suggests that anything between 4% and 6.4% for the US. In other countries, unemployment can be as high as 13% and still considered full employment.

Investopedia says anything from 2 - 7%.

From a PBS site back in 2013:

Question: No one is satisfied with current numbers for employment or unemployment levels. My question: What is the metric (level) that we’re supposed to be at? In the 1960’s, 4 percent unemployment was considered to be full employment. Over the past years, that number seems to be accepted as being higher: 4 percent, 5 percent, 5.5 percent or even 6 percent.

"Over the past years" -- remember, this was five years into the Obama presidency -- the unemployment percent for full employment seems to have gradually moved to 6 percent from 4 percent.

I assume we are about ready to see headlines -- perhaps as early as next week if initial claims fall -- that the US is at full employment.

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Best Description Of Hillary Yet

From The Daily Beast:

The truth is Hillary Clinton has supported every US war since Vietnam.

She supported not only DOMA, which her husband signed, but a travel ban on those who were HIV positive.

She supported welfare cuts (remember her husbands efforts towards “ending welfare as we know it”?). She supports the death penalty and campaigned in her husband’s place during the 1992 New Hampshire primary when he left to oversee the execution of an African American man whose suicide attempt left him brain damaged.

And if “mass incarceration” is a problem today, keep in mind she has long advocated for the criminal justice policies that called for locking up more people for longer periods. She supports—and, as Secretary of State, participated in—the US policy of targeted assassinations, including when the targets were American citizens.

In a political environment in which income inequality is a rallying cry, she makes $300K plus expenses an hour. In fact, she would be the wealthiest person elected president in the modern era.