Initial weekly unemployment claims is a volatile number, subject to revisions. Regardless the below graph shows a disturbing trend in weekly initial unemployment claims, they simply are not going down to pre-recession levels. The 4-week average on initial unemployment claims is as high as April 2010.
In the week ending July 24, the advance figure for seasonally adjusted initial claims was 457,000, a decrease of 11,000 from the previous week's revised figure of 468,000. The 4-week moving average was 452,500, a decrease of 4,500 from the previous week's revised average of 457,000.
A general rule of thumb is weekly initial unemployment claims need to drop below 400,000 for job growth to occur.
Below is the log of the initial unemployment claims 4 week average for a decade. By using logs, we create a noise filter on weekly initial claims to see the change over time. As you can see, it appears weekly initial claims have found their bottom and are staying there. That bottom is above the level we need for job creation.
That is super bad news and implies Americans are going to have structurally permanent job losses.
Unemployment and Self Employment.
I live in Alberta Canada one of the areas in North America least effected by the slow down. However I have seen a large amount of people turning to self employment. Is this true in other areas of NA?
More on Job Losses
Here in South Florida (Tampa Bay area) we have 12 percent unemployment, and the labor arbitrage continues. PriceWaterhouseCoopers is about to lay off 500 high end techs and subcontract the work to Tata Consultancy (IT) in Mumbai. PWC is headquartered in London and is truly global, but the social costs are still local. These layoffs come after Nielsen Media Research which is shifting 170 tech jobs to India, and IDEARC Media (yellow pages) cutting 150 to outsource the work to India. This on top of declining tourism thanks to BP. I understand the "Buy American" Act does not extend to services, but there has to be a point at which such activity at least damages a brand in this country. IMO, there should be some sort of sanction against this corporate behavior.
Looking at the job loss numbers in the 2007 recession, manufacturing stands out, followed by professional services. Not a good sign.
Frank T.
proving it not easy
Do you have or does anyone have a database of layoffs plus offshore outsourcing numbers from 2007 on?
first it's hard to obtain these numbers and next they will claim "unusual expertise and skills". Now usually one can disprove those for obviously "PHP developer" is not a rare an unusual skill, etc. and point to 150k engineers with that skill who cannot get a job somewhere.
But it sure does appear that's what's happening, more offshore outsourcing, more demands that all production jobs are in China, R&D jobs in India and so on...
i.e. anywhere but the U.S. and anybody but a U.S. citizen mantra/mentality in corporate "America".
Offshoring (Offwhoring)
Bob,
I don't know that such data are available. Someone should be tracking this, but I am not aware who is. Economy is somewhat porous in some places. Software industry has been doing this a long time (US programmers working during the days, Indian programmers working on same product be night) but that was not necessarily to save money on labor. But correlating job loss here with contractors overseas may have escaped attention. Somebody must have tried estimating the magnitude of such displacement.
Frank T.