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Economic Alert: NJ Unemployment Claims Continue Downward


By Patrick J. O'Keefe, Director of Economic Research, J.H. Cohn

Earlier today, the U.S. Department of Labor published weekly unemployment insurance statistics, including data for New Jersey through the week ended May 19, 2012.

NJ Highlights:

  • New claims drifted lower in the most recent week;
  • Applications were almost one-fifth below pre-recession levels;
  • Continuing claims were at six-month low.

View accompanying charts.

Initial claims (chart 1), a proxy for layoffs, dropped slightly (-2.0%) from the prior week and were 10.6% below the equivalent week a year earlier.

The week-to-week slippage is consistent with the seasonal pattern that occurs each year between early May and mid-June, when school closings begin.

For the fifth consecutive week, the number of new claims was below the weekly average during the five years (2003-2007) prior to the recession. In the week ended May 19, applications were almost one-fifth (18.9%) below the pre-recession level.

The four-week average (chart 2), which smoothes weekly fluctuations, posted its lowest reading for any week in May since 2008, in the early months of the contraction.

Continuing claims (chart 3), that is individuals receiving regular weekly benefits, slipped 2.0%, the fourth consecutive weekly decline. The total number of beneficiaries was at the lowest level since November.

The continuing claims count was 46.8% below the March 2009 recessionary peak. Yet despite trending downward for more than two years -- the claims count has been down year-on-year in all but one of the past 125 weeks -- the total number of beneficiaries remains 4.5% above the pre-recession average.

The State's insured unemployment rate (IUR), the number of beneficiaries as a percent of total covered employment, fell to 3.3%, down slightly from the prior week's 3.4%. The IUR was 3.6% in the comparable week of 2011.

In sum: The level and pattern of new claims (i.e., fluctuating mildly at relatively low numbers) and the sustained decline in the number of individuals collecting regular benefits, suggest that employment in New Jersey may be growing moderately.

Patrick J. O'Keefe is director of economic research at J.H. Cohn. He can be reached at pokeefe@jhcohn.com or 1-877-704-3500.

Visit the "Insight on the Economy" resource page and sign up to receive Economic Notes.

Published date: 5/31/2012

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