The rule of thumb in the economic world is that weekly initial jobless claims must be in the 300,000 range in order to get to actual job growth. We haven’t been at 300,000 since the beginning of the recession in December 2007. During the worst spell of the recession, in early 2009, the number was at 650,000. But today’s jump brings us to 500,000, a high for the year.
You can see the trajectory in this Calculated Risk graph. We’ve basically gone sideways since last year, but the last month has moved upwards. “The economy ran into a wall in August,” according to one analyst quoted in the story.
Chart from Zerohedge:
500,000 is a new benchmark, in the wrong direction. I wonder, is this still within the parameters of the "sideways recovery" Oilfinder talks about?
CBO projections also out today:
WASHINGTON (Reuters) - The U.S. economy faces even more difficult times ahead with chronic high unemployment rates and slow manufacturing growth hurting the recovery, Congressional Budget Office Director Douglas Elmendorf said on Thursday.
The U.S. unemployment rate will not fall to around 5.0 percent until 2014, Elmendorf wrote in his blog about CBO's new economic and budget outlook.
Without significant changes in U.S. tax and spending laws, the U.S. government will struggle to dig its way out of a fiscal deficit hole...
The U.S. budget deficit last year was a record $1.413 trillion, 9.9 percent of gross domestic product.
So according to the CBO, we won't get to pre-recession levels of employment until 2014! And you have to wonder how they even come to that prediction -- what the heck do they actually see getting better by 2014??? And what are the 99'ers, who are now getting cut off and facing homelessness, supposed to do for the next four years?
Oh, one more fantasy projection from the CBO.. according to them, the deficit will fall from 9.9% of GDP now to 4% in 2012.