Jobless Claims as Percent of Payrolls Aren't as Bad as in Previous Recessions

| About: SPDR S&P (SPY)
This article is now exclusive for PRO subscribers.

Scott Grannis has a nice pair of charts showing unadjusted weekly unemployment claims (top chart), and jobless claims as a percent of payrolls. I have previously featured a similar analysis using the jobless claims as a percent of the labor force, but haven't updated my charts lately, so thought I would feature Scott's.

There's a serious problem using unadjusted jobless claims: the population, payroll levels, and labor force have all doubled since the early 1960s, making unadjusted comparisons of jobless claims today to past years pretty meaningless. As the bottom chart above shows, we're currently at about the same level of jobless claims (as a percent of payrolls) as the 1990-1991 recession, but not even close yet to the jobless claims levels of the 3 recessions during the 1970s and 1980s.

As I have reported before, and as Scott's charts show, jobless claims today would have to be about 50% higher, or about 900,000, to be as bad as the recessions of the 1970s and 1980s.