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Brooks Wilson's Economics Blog: Four Week Moving Average of Unemployment Rises

Thursday, June 4, 2009

Four Week Moving Average of Unemployment Rises

Shobhana Chandra of Bloomberg analyzes this week's unemployment numbers in "U.S. Initial Jobless Claims Fall 4,000 to 621,000 (Update1)."
June 4 (Bloomberg) -- Fewer Americans filed claims for unemployment benefits last week, signaling the most acute phase of job losses may be over even as hiring has yet to pick up.

Initial jobless claims fell by 4,000 to 621,000 in the week ended May 30, in line with forecasts, from a revised 625,000 the prior week, the Labor Department said today in Washington. The number of people collecting unemployment insurance fell for the first time in almost five months, breaking a string of 17 consecutive records...

The four-week moving average of initial claims, a less volatile measure, climbed to 631,250 from 627,250.
Research by Robert J. Gordon finds that recessions often bottom out shortly after the four-week moving average peaks.  The average may have peaked on March 28, 2009 at 659,500.  Only time will tell if the small climb of 4,000 in the average represents a new upward trend in the average, a stabilizing of the average, or a small bump in the downward trend.


  1. Ernesto Ibarra9/6/09 7:43 PM

    Unemployment is falling slowly but surely. It may or may not indicate a progress towards a good economy but, nonetheless we must not grow weary and be patient. We must not only rely on the unemployment rate to indicate a good economy. I believe that another good indicator for wealth is overall happiness that our citizens experience. My friend asked me while fishing a week ago “Do you think we are destined for Doom?” I replied “No!”

    Yes we are in an uncertain economic position but our overall joy and addiction to leisure also indicates that as Americans we love to relax and have fun, our economic position has not derailed us from living the Good ole life. Even during troubling time we find time to go fish and swim at the lake, whereas in other countries it would be unthought-of to go spend money and have fun while we are down on money. We then were interrupted by a zooming boat with a red, white and blue

  2. Kayla Harding10/6/09 11:26 PM

    I agree with above comment that I don't think we are destined for doom! But sometimes you have to hit rock bottom in order to climb back up. Or as my mother thinks we are retracing our steps from the past events with war and depression! Just hopefully we wont be hit as hard as it was in the past.

  3. Many factors have an impact on the business cycle which in turn affect unemployment rates. As demand of a product increases so does the price; however, this is not always as bad as it seems. Since there is a higher demand of the product, more employees are needed to produce it; therefore opening new positions in the job market. It seems to me that as unemployment rises, demand for goods and services falls which leads to further job loss. In my opinion, if we don't let the "doomed economy" scare us and we keep spending money like normal, maybe demand would stay up and unemployment would stay at a minimum.