Let’s review recent unemployment claims to see what the trends suggest.
Wolf Richter answered my pointed question in his take on Thursday The Extra $300/Week Unemployment Benefits Encouraged Many to Not Work: Details about the “Labor Shortage” Pile Up
- In the 27 states that have ended the extra $300 a week in federal unemployment benefits, paid on top of the regular state unemployment insurance, people are returning to work at a much faster rate than in states where the extra $300 a week are still being paid: this was further confirmed today by the unemployment insurance (UI) data from the Labor Department.
- Continued claims by the states that kept the extra $300 a week (the Keepers) dropped by only 11%. In other words, continued UI over just those weeks since the end of June dropped over twice as fast in states that had ended the extra benefits.
- The four-week moving average irons out some of the week-to-week ups-and-downs that tend to occur in every state, which, when it happens in one of the big states, can skew the national weekly data. Being a four-week moving average, it lags the weekly data, but it shows the trends:
Continued Claims 4-Week Moving Average
Hiring managers and business owners who need to fill open positions have known this in their gut for months: Paying people as much or more to not work than they made while working encourages them to not work, even though the pay is now higher than it was before.
Wage Pressure Inflation
The Fed and the Biden administration are both pleased with wage pressure inflation.
The Fed hides behind “It’s transitory” but who knows what they really think.
The Biden administration wants wages to go up despite the fact those on fixed income are getting clobbered and that rents and home prices are rising far faster than wages.
How About a Bit of Sanity Please?
Hey, I found some.
Unfortunately, it’s insane to expect any sanity when it comes to spending.
The D.C. “compromise” is inevitably more wasted money for wars and more “free money” handouts and social projects like “affordable housing” that fail every time.
— Mike “Mish” Shedlock (@MishGEA) August 21, 2021
Unfortunately, it’s insane to expect any sanity when it comes to spending.
Republicans pretend to be fiscally conservative but never are in practice.
The D.C. “compromise” is inevitably more wasted money for wars and more “free money” handouts and social projects like “affordable housing” that fail every time.
This article was originally published by Zero Hedge. Read the original article.
