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NJ Unemployment Claims Data Continue to Improve


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

3/21/2013

View accompanying charts.

Earlier today, the U.S. Department of Labor published weekly unemployment insurance (UI) statistics, including data for New Jersey through March 9, 2013. 

In the most recent week (see endnote for Sandy-related background):

  • New claims were below pre-recession average for fourth consecutive week;
  • Continued claims remained seasonally elevated, but were below year ago level;
  • Adjusted for seasonal factors, ongoing claims are at lowest since August 2008;
  • NJ’s insured unemployment rate was below year-ago.

 

Initial claims (chart 1) rose modestly (+1.7%) in the week ended March 9th. 

Applications for benefits have fallen by more than one-half (-56.9%) -- down in 8 of 10 weeks -- since recording the post-holiday seasonal peak at the end of December.  

When adjusted for seasonality (chart 2), the decline from the post-holiday peak, while narrower (-25.0%), was still substantial.

New claims were 2.5% less than in the comparable week of 2012.

In the most recent week, new claims were below the weekly average during the five years (2003-2007) prior to the recession for the fourth consecutive week, most recently 11.2% lower; and more than one-quarter less (-27.8%) than the weekly average during the recessionary years of 2008-2009.

Continued claims (chart 4), that is individuals receiving regular weekly benefits, declined somewhat (-2.8%) in the week ended February 23, 2013 -- reversing the rise in the prior week.

Despite the weekly fluctuations, ongoing claims have remained on a downward path since the post-Sandy peak at the end of November.  The four-week claims average has declined slowly, but steadily since the beginning of the year.

Adjusted for seasonal influences (charts 5 and 6), continued claims are -- with one exception -- back to levels last seen in the summer of 2008.  The one exception was the last week in October (immediately prior to Sandy). 

Assuming normal patterns, ongoing claims should trend downward into May.

The State’s insured unemployment rate (IUR), the number of beneficiaries as a percent of total covered employment, slipped to 4.1% (from 4.2% in the prior week).  Among all states, New Jersey shared the third highest IUR with Montana and Pennsylvania.

In sum:  Applications for unemployment insurance benefits in New Jersey remain well below the pre-recession average.  And while the number of individuals collecting regular benefits is seasonally elevated, it continues to trend downward. 

These data are consistent with conditions in which the State’s labor market is growing modestly, but steadily.

Sandy-related Background:

New Jersey’s UI data spiked after Hurricane Sandy, which made landfall in New Jersey on October 29.  In the storm’s immediate aftermath, initial claims jumped 168.7% relative to the comparable period in 2011.

In the two weeks immediately after the storm, 91,760 claims were filed (the comparable figure for 2011 was 24,162); in the next three weeks, 65,408 applications were filed in 2012 (versus 30,628 in 2011).  The number of new claims filed in November 2012 was almost triple the same month in 2011.

The post-storm spike in applications was followed by a substantial rise in continued claims.  But that jump was far less pronounced than the surge in applications because payments as a proportion of new claims fell to the lowest level on record since 1999.

Ongoing claims fell below the prior year’s comparable period in the week ended January 19th and have remained so since.

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