If we use my rule that three weeks makes a trend, then the trend in new unemployment claims is something to worry about. This week’s Unemployment Insurance Weekly Claims Report was another disappointment, marking three weeks of unwelcome increases. New claims came in at 500k, the worst since the November 14th reading, when the bad numbers were falling. Last week was revised up 4k. This was outside of the Bloomberg consensus range of 465k to 495k. From the report:

In the week ending Aug. 14, the advance figure for seasonally adjusted initial claims was 500,000, an increase of 12,000 from the previous week’s revised figure of 488,000. The 4-week moving average was 482,500, an increase of 8,000 from the previous week’s revised average of 474,500.

The advance seasonally adjusted insured unemployment rate was 3.5 percent for the week ending Aug. 7, unchanged from the prior week’s unrevised rate of 3.5 percent.

The advance number for seasonally adjusted insured unemployment during the week ending Aug. 7 was 4,478,000, a decrease of 13,000 from the preceding week’s revised level of 4,491,000. The 4-week moving average was 4,526,750, a decrease of 1,500 from the preceding week’s revised average of 4,528,250.

If there’s any good news in this report, it is that the unadjusted data took a breather this week. As usual, the adjusted data is useful for finding trends, but the unadjusted data is the data that corresponds to actual human beings. Take some solace there:

The advance number of actual initial claims under state programs, unadjusted, totaled 401,856 in the week ending Aug. 14, a decrease of 22,650 from the previous week. There were 457,985 initial claims in the comparable week in 2009.

The advance unadjusted insured unemployment rate was 3.4 percent during the week ending Aug. 7, unchanged from the prior week. The advance unadjusted number for persons claiming UI benefits in state programs totaled 4,254,571, a decrease of 78,949 from the preceding week. A year earlier, the rate was 4.4 percent and the volume was 5,808,572.

This will show up with a better-looking good list in next week’s report. This week’s good/bad lists look terrible, as expected from last week’s unadjusted data:

The good list (-1000 or more): WI, PR

The bad list (+1000 or more): TX, IL, FL, OR, MI, GA, PA, NC, IN, CA

CA (the worst) was +4,393 vs WI (the best) at -1,873. Manufacturing took the most blame, but trade, service, and construction were all well-represented in the bad list. Indiana blamed auto layoffs, which are a bit late in the cycle, so it is possible that we should be looking at a six or seven week average. Back then we had good reports with a possibility of the adjustments being caused by auto factories running longer than normal.

In other news, Tier V benefits are beginning to get discussed in more detail, but I can find no articles in the mainstream that are optimistic about a bill passing.

This was another terrible report, but at least this report was conditionally terrible. We’re back where we were 9 months ago in terms of labor market instability. The trend has a chance at reversing if the automakers are to blame for the bump in the adjusted data. Other economic data has started to turn negative again. Optimistic outlooks should be tempered by the other data.