Below is a chart and brief excerpt from today's Early Look written by Macro analyst Christian Drake. 


To quickly redux the larger setup with respect to Jobless Claims:

  • Initial Claims have stalled for the last 10-weeks at a level 25% higher than the highest levels observed historically.  In fact, they have re-inflected higher in recent weeks are now going the wrong way …. 30+ weeks in … and despite no updated reporting out of California (more on that below).
  • Continuing Claims have continued to improve, but that “improvement” is, at least partially, illusory as it more likely represents individuals losing eligibility than it does large-scale re-employment. 
  • PEUC Claims:  Pandemic Emergency Unemployment Claims (PEUC) provide an additional 13 weeks of benefits once normal state benefits (which typically last 26 weeks) are exhausted. This will continue to be the measure to monitor is it will realize the largest inflow as individuals exhaust regular state benefits.  Indeed, PEUC claims spiked +818K W/W last week and are up 1.17 mn in the last three weeks. Note that PEUC Claims are lagged two weeks, so only really reflects the lead edge (2 weeks) of the roll-off in eligibility. 
  • Benefit Cliff:  The clock is ticking on extended benefits as all pandemic related UI programs (PUA, PEUC, etc) expire on December 31st

CHART OF THE DAY: Continued Claims ↓ PEUC Claims ↑ - CoD PEUC