Mark J. Perry of Carpe Diem fame has been running a series on the uselessness of raw jobless claims numbers. I was not surprised by this post last week concerning the unemployment claims released each Thursday. "Unemployment Claims" is one the best leading indicators that we get from the government that helps us measure how far we have to go before we see a sustained economic upturn.
And when we adjust the current claims by the size of the workforce - the level of claims makes this recession out to be less worse than the gurus would have us believe.
Jobless Claims Don’t Reach Those of the ’70s and ’80s « The Enterprise Blog.
Perry writes:
This adjusted measure of jobless claims also shows that we never came anywhere close to the levels during the recessions of the 1970s and 1980s, when jobless claims peaked at over 0.60 percent of the labor force on several occasions. To reach that percentage today, we would have to have more than 900,000 jobless claims given the size of our current labor force, which is much higher than the peak jobless claims level in April of 658,750.
Bottom Line: After adjusting for the size of the U.S. economy, jobless claims as a share of the labor force during the most recent recession were higher than the peaks during the 1990-1991 and 2001 recessions, but not anywhere close to levels reached during the recessions of the 1970s and 1980s.
The Great Recession was not so "Great" after all. Could it be that we were frightened on purpose?
BERK
