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NJ Unemployment Claims Drop


10/31/13

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

Earlier today the U.S. Department of Labor published unemployment insurance (UI) data, including statistics for New Jersey through the week ended October 19. 

NJ Highlights:

  • New claims fell sharply, reversing jump of previous two weeks;
  • Continuing claims declined to second lowest total in five-plus years;
  • New and ongoing claims were below pre-recession averages;
  • Insured unemployment rate below 3.0% for two consecutive weeks.

     

View accompanying charts.

Initial claims (chart 1), a proxy for layoffs, fell by about one-fifth (-19.7%) almost fully reversing the increases of the past two weeks. Total applications were down considerably (-17.5%) from the comparable week a year ago.

As a result, new applications were substantially below (-19.0%) the average weekly filings during the 5 years (2003-2007) prior to the recession.
Adjusted for seasonality (chart 2), filings were some one-quarter (-23.2%) lower than the previous week. 

(As noted last week, the impact on new filings of the Federal Government’s shutdown remains unclear, but it may have accounted for some of the recent volatility in the seasonally adjusted data. Although none of the fluctuations in total applications reflected filings by furloughed Federal workers -- they are covered by a separate program -- some of it may be attributable to shutdown-related layoffs by private employers).

The seasonally adjusted four-week average (chart 3) -- which adjusts for regularly recurring changes and smoothes weekly fluctuations -- slipped 1.5%, within the narrow range that (excluding Superstorm Sandy’s spike) has prevailed since the start of 2012.

Continuing claims (chart 4), that is individuals receiving regular weekly benefits, declined moderately (-3.9%) in the week ended October 12 and were 7.3% below 2012’s comparable week.  

For the fifth consecutive week, the number of beneficiaries was below the pre-recession average, most recently 7.2% lower. Except for the week in which Superstorm Sandy made landfall, the total claims count was the lowest since June 2008.

Adjusted for seasonality (charts 5 and 6), the number of claimants declined 4.9% from the prior week. Longer term, seasonally adjusted claims were two-fifths (43.1%) below the June 2009 recessionary peak, but remain 9.4% above the pre-recession average.

The State’s insured unemployment rate (IUR), the number of beneficiaries as a percent of total covered employment, was 2.9% for the second consecutive week, something that had not occurred since mid-2008.  Nevertheless, New Jersey’s IUR ranks second among all states.

In sum: With applications for benefits fully reversing the increases of the past two weeks, the number of new claims was well below the average weekly level that prevailed in the five years prior to the recession. 

Although the total number of beneficiaries has been fluctuating week-to-week since mid-September, they have declined on net and are 7.2% below the pre-recession average. When adjusted for seasonal fluctuations, ongoing claims have been relatively flat over the past six months (i.e., since the post-Sandy spike began to recede).


The statements, opinions, and conclusions contained herein are based solely upon the author’s own studies, research, and personal experience. Neither CohnReznick nor the author make any representation or warranty as to the accuracy or completeness of this information. CohnReznick and the author expressly disclaim any liability for any loss or damage which may be incurred, of any kind whatsoever, as a result of or arising from the use of any of the information contained herein or reliance on the accuracy or completeness of it.

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