Initial claims for jobless benefits fell by 94,000 to a seasonally adjusted 492,000 in the week ended Dec. 27 from an unrevised 586,000 the week before, the Labor Department said Wednesday.
Wednesday, December 31, 2008
Effective January 1st, 2009 Florida is raising the Minimum wage to $7.19/hour. Economists frequently make the argument that as the cost of labor increases, the demand for labor goes down. Consequently, at the margin, this increase in minimum wage could help drive the rate of unemployment higher.
WCTV has the story here.
HARTFORD -- Connecticut officials plan to increase taxes on businesses in 2009 because the state's unemployment fund is paying out more money to jobless workers than it is taking in.
The state Department of Labor anticipates it will assess employers an extra 1.4 percent in unemployment taxes next year. Officials say they need to keep the unemployment fund solvent.
Connecticut's unemployment rate is the highest it's been in 15 years, at 6.6 percent. State unemployment offices are handling about 80,000 claims a week, a 50 percent increase over last year.
The unemployment fund is expected to pay out $690 million and collect $540 million in revenue this fiscal year, said George Wentworth, the Labor Department's director of program policy.
But since the unemployment trust fund has about $465 million in it, officials say there are no immediate concerns about running out of money to pay benefits. The state, however, may have to take out some short-term loans to shore up the fund if current economic trends continue, officials say.
"Right now, it looks like we are OK for the immediate future," Wentworth said.
The unemployment fund has run out of money before, the last time in the early 1990s when the federal government had to bail out the state. The federal government has an unemployment trust fund from which states can borrow, and they can repay the loans within a year without being charged interest.
Michigan and Indiana have already asked for federal loans so they can continue to pay unemployment benefits, and the National Association of State Workforce Agencies says 30 other states are at risk of running out of money to pay for unemployment benefits over the next few months.
The Connecticut Business & Industry Association is keeping tabs on the state's unemployment fund, said Joseph Brennan, the group's senior vice president for public policy.
"It is always a concern when you are going through an economic downturn," Brennan said.
The CBIA has already warned its 10,000 members to be prepared for higher unemployment taxes in 2009.
The state Labor Department assesses unemployment taxes based on the amount of claims paid to former employees. The rate ranges from 0.5 percent to 5.4 percent of the first $15,000 in wages that a company pays each worker.
The typical company in Connecticut paid 1.7 percent on the first $15,000 of a worker's wages in 2008.
The state can impose an additional tax to keep the unemployment fund solvent. Wentworth said state Labor Commissioner Patricia Mayfield is preparing to impose the maximum 1.4 percent solvency tax on employers in 2009.
Connecticut's maximum unemployment benefit is $519 a week.
Tuesday, December 30, 2008
This article from the Greenville News highlights the troubles that the state of South Carolina is facing with their unemployment insurance fund.
About 77,000 unemployed South Carolinians would be without jobless benefits at the end of the day if the governor and state employment officials don't resolve their standoff about a federal loan.
The unemployment trust fund runs dry Wednesday unless Gov. Mark Sanford requests a $146 million federal loan, but the governor is withholding his approval until the Employment Security Commission agrees to his demands, including an audit by a state agency.
House Speaker Bobby Harrell said the ESC should comply with Sanford's demands including the audit.
Roosevelt T. Halley, executive director of the ESC, said he is willing to be audited by the U.S. Department of Labor because the program uses federal funds and operates under federal guidelines.
He also said he would be willing to have an audit by the Legislative Audit Council if the state Legislature requests it. Although the request must originate in the Legislature, a spokesman for Sanford, Joel Sawyer, said it would send a stronger signal if the governor and the head of the commission signed off on the need.
Last month, South Carolina reported the nation's third-worst unemployment rate at 8.4 percent, and Halley said he could run out of money today to issue unemployment checks. The agency normally writes checks Sunday through Thursday.
New Jersey’s maximum weekly unemployment insurance benefit will increase on January 1st, 2009.
The rate is determined annually based on the statewide average weekly wage, which increased by 4.3 percent in 2007.
For new unemployment insurance claims, the maximum weekly rates will increase from $560 to $584.
On a side note: check out http://mortgagestats.blogspot.com for some interesting statistics on New Jersey's sub-prime and alt-a mortgage delinquencies.
You can expect the unemployment insurance programs in these hard hit states to be stressed for the next few years.
Monday, December 29, 2008
*Note---Some States had a range for "Maximum Benefits", but most had a single value. Massachusetts for example was shown as "$600 - $900/week"---I have plotted, the high end of the range. I believe that some states may pay more to people with families than to single workers with no dependents.
Sunday, December 28, 2008
And for those fortunate few to make it through to a live human being on the other end, they have to wait up to 40 minutes!
Read the story here.
Workers hired to deal with unemployment claims
12:31 PM CST, December 27, 2008
MADISON, Wis. - The state has hired 83 more workers to deal with a surge in unemployment claims.
Department of Workforce Development spokesman Richard Jones says the new short-term workers have already been hired and will boost the group by 20 percent.
Some are agency retirees and will start by January at hourly salaries of between $15 and $17 an hour.
Preliminary state figures show Wisconsin lost 32,400 jobs in November compared with the same month in 2007, falling to 2.87 million, while the unemployment rate shot upward that month.
The workers' salaries are federally funded and will cost about $215,000 a month.
The hiring comes as Gov. Jim Doyle wants to reduce the number of state workers by 700 in response to a $5.4 billion projected state budget shortfall.
Monday, December 22, 2008
From the Delmarva media group:
Del. unemployment fund runs low
By Eric Ruth
The News Journal
When times are good, Delawareans have plenty of jobs, the jobs create plenty of tax revenue, and the state's unemployment insurance fund is fat, happy and maybe a little lonely.
But months of economic decline have depleted Delaware's reserves for unemployed workers -- and simultaneously diminished the means of replenishing it. The steady drawdown of cash may eventually demand a remedy that could one day mean higher taxes on employers, or lower benefits for jobless workers.
The state's unemployment insurance fund, while shrinking, is still in better shape than most states', and officials are cautiously optimistic that the economy will turn around before drastic action is needed.
"The economic cycle reversed itself" the last time the fund was declining in 2002-2003, said Tom MacPherson, director of the state Division of Unemployment Insurance. "At some point in time, there will be a rebound."
That's a hope that has been proved wrong here in the past, however. And it's a situation that is occurring with more frequency across the nation as layoffs rise.
Nineteen states have less than the recommended year of reserves to pay benefits, and four states are down to one to three months, according to U.S. Department Labor data. Michigan has run out of money and borrowed from the federal government.
Saturday, December 20, 2008
- In November 2008, there were 20 states with unemployment rates greater than 5%. And 9 states (+ the District of Columbia) have unemployment rates greater than the national average. In November 2008, there were 20 states with unemployment rates greater than 5%. And 9 states (+ the District of Columbia) have unemployment rates greater than the national average.
The States with the highest unemployment rates in November were:
- Rhode Island--9.3%
- South Carolina--8.4%
- Washington DC--8.0%
- North Carolina--7.9%
- New York--6.1%
I suggest that if you really want to learn more about Option ARMS I suggest you go to: http://www.doctorhousingbubble.com/
Friday, December 19, 2008
Just yesterday Heidrick & Struggles, one of the world's largest executive search firms, announced that it laying-off 15% of its work-force.
Heidrick & Struggles Announces Plans for Additional Cost Savings as a Result of Current Market Conditions
Chief Executive Officer
Kelly added, "There are a number of additional variable costs that we are evaluating as part of our commitment to achieving the highest possible operating margin. But we will also continue to judiciously evaluate opportunities that increase our position of market leadership today and in the future."
S.C. unemployment rate rises in November, more jobs shed
From "thestate.com" staff reports
South Carolina’s unemployment rate rose to 8.4 percent in November, while job losses statewide mounted, according to a report released today.
The rate — now the highest since September 1983 — is expected to continuing rising past 10 percent next year.
The number of jobs excluding farms fell 11,900 between October and November and are down nearly 43,000 from November 2007, the SC. Employment Security Commission said.
The big losses came in leisure and hospitality (down 7,800 jobs between October and November), professional and business services (down 4,200 job) because of cuts by temporary help agencies. and construction (2,500 jobs).
Government was November’s biggest gainer, adding 2,700 jobs as schools hired support staff.
Retailers did add 1,300 workers last month for the holiday season, but “this is far below the number typically hired during this time of year,” the commission said.
Read the rest of the story here
But in general you can see some trends, LA and Las Vegas have seen the steepest increase in unemployment rate during the last 2 years---followed by Atlanta & Chicago. And the diverse New York City economy seems to be holding in there a little bit better than its peers.
In November, Rhode Island saw job losses in retail, manufacturing, construction, business services and accommodation and food service sectors. With additional corporate layoffs that came in December, you can expect that the December figure released next month will be higher.
Unfortunately, with the economic woes being experienced by Chrysler, GM, and Ford and with their sales continuing to decline, I think that the Auto-sector in Michigan could push Michigan to be the first state to have over 10% unemployment in 1 or 2 months.
Thursday, December 18, 2008
And as the Automaker CEO's have mentioned before, if customers are concerned about a potential bankruptcy, they stop buying cars... You can see from the Detroit Free Press chart below that there is a growing amount of Chrysler inventory in the market place.
Another big issue concerning Chrysler, and possibly General Motors, in the case of "an orderly bankruptcy" is the impact it will have on the auto-dealers. Many people don't realize it, but the thousands of dealers out there are generally unsecured creditors of the Auto Companies. Every month or quarter, the Automakers provide payments to the dealers to cover expenses/revenues surrounding such things as warranty repairs, dealer holdback, and showroom financing---If a bankruptcy occurs and all the creditors start lining up to get their share of payments, I fear that many dealers will not be able to survive based upon the "credit" that they extended to the OEM's.
I find it interesting how the recessions always see a big immediate spike in unemployment and then it takes years from the peak to get the unemployment levels back down. It's also worth noting that this data does not include "discouraged workers" or the "underemployed".
You can watch a CNBC video about these statistics here:
Tuesday, December 16, 2008
If you look at Data for December 2007, there was 7.3mm "Unemployed" and the Unemployment Rate was 5.0%---If you add in the Discouraged and "UnderEmployed" the broader-unemployment jumps to 12.4mm or 8.5%.
If you look at Data for November 2008, there was 10.0mm "Unemployed" and another 8.0mm people who were either "Discouraged" or "Under-employed"---With the reported level of unemployment being 6.7% in November 2008, I calculate that the broader-unemployment in November 2008 is actually closer to 12.1%
You can see a video about the situation here:
If you need more information about Wisconsin's Unemployment Insurance program check out: http://www.dwd.state.wi.us/ui/
When a state does run into trouble, they can borrow money from the federal government. But eventually, the state will need to start collecting more unemployment insurance premiums than the money they are paying---so that means eventually raising the UI premiums that employers must pay (or else reducing the unemployment rate).
You can read the entire New York Times article here.
Everyone needs a laugh once in a while, and why not let it be a haiku! Check out Matt & Todd's website.
Monday, December 15, 2008
The link below shows the entire video. If you're looking for some of the highlights, watch the beginning of the interview when he explains the grounds for his theory, and at ~15:40 for about 2 minutes.
This potential wave of future resets in Alt-A and Option ARMs, according to Credit Suisse really begins in 2009, ramps up in 2010, and ramps up again in 2011.
These resets, coupled with increasing unemployment rates, in my opinion will continue to hold-down real estate values for the next several years.
I have more mortgage statistics at http://mortgagestats.blogspot.com
Watch CBS Videos Online
According to the Bureau of Labor Statistics, the unemployment rate for the "Chicago-Naperville-Joliet" area was slightly lower than that of the entire state at 6.9% in October-2008.
If you're unemployed in the state of Illinois, you should check out http://www.ides.state.il.us/ for up-to-date information on how to file for unemployment insurance.
If you are looking to file an unemployment claim in the state of New York, go to http://www.labor.state.ny.us/ui/ui_index.shtm to learn more.
Sunday, December 14, 2008
Save for hefty health-insurance costs in the event of unemployment
Many overlook paying for health care while unemployed
Carolyn Bigda Getting started
December 14, 2008
Most people under 65 obtain health insurance through an employer, according to the latest survey by the Kaiser Family Foundation and the Health Research Educational Trust, which study health-care policies.
When you lose your job, you may be entitled to keep your coverage for up to 18 months, depending on the size of your firm. But like your paycheck, any subsidy you received for the premium, and employers frequently cover 50 percent or more of the annual cost, goes away.
The full cost of an employer-provided plan can be pricey: On average, the annual premium for an individual policy in 2008 was $4,704, according to the Kaiser/HRET survey. A family plan was $12,680.
Read the rest of the story here.
Friday, December 12, 2008
You can read some of their viewpoints at:
And companies have an incentive to scale back labor expense by lay-offs and then hiring back the workers near the time of expiration of Unemployment benefits as a cheaper way of managing their business during slowing economic times.
First the bad news---The unemployment continues to climb. Reaching 7.0% in the most recent reporting month (October 2008). Undoubtedly, much of the increase in unemployment has came about from the crashing real estate market in the sun-shine state.
Now the Good News: Since the unemployment rate is so high, for those folks affected the length of time which you can collect unemployment has been extended.
Needless to say, this should cause Georgia's unemployment rate for November, 2008 to be higher than the 7.0% that it had in October, 2008.
Thursday, December 11, 2008
WASHINGTON (Reuters) – The number of U.S. workers filing new claims for jobless benefits surged to a 26-year high last week, Labor Department data showed on Thursday, as a deepening recession forced employers to cut back on hirings.
Initial claims for state unemployment insurance benefits jumped by 58,000, the biggest increase since September 2005, to a seasonally adjusted 573,000 in the week ended December 6 from an upwardly revised 515,000 the previous week. That was the highest print since November 1982, when 612,000 workers submitted new claims for unemployment benefits.
Read the rest of the story here...
(Reporting by Lucia Mutikani; Editing by Walker Simon)
Tuesday, December 9, 2008
Monday, December 8, 2008
- The number of new Undergrad students at DeVry is up 20% (Fall 08 vs. Fall 07)
- The number of total Undergrad students at DeVry is up 17% (Fall 08 vs. Fall 07)
- The number of online courses being taken is up 25.5% (Nov 08 vs. Nov 07)
Surge in jobless claims taps out New Jersey unemployment fund
by Dunstan McNichol/The Star-Ledger Monday December 08, 2008, 12:05 AM
A surge in jobless claims has battered the fund that bankrolls unemployment benefits in New Jersey, exhausting all of the $260 million emergency infusion sent five months ago and raising the prospect taxpayers will be asked for more.
An additional subsidy early next year for the state's Unemployment Insurance Trust Fund, either from the state or federal government, is not "a definite," Gov. Jon Corzine said in an interview last week. But he added: "We need to be planning."
Read the rest of the story here...
Sunday, December 7, 2008
IOUSA was a movie released in 2008, that helps put into perspective the fiscal situation which the United States is in. Net-net, in a few decades the US government isn't going to likely be able to provide all the benefits that they have promised---so be sure to start saving for your own retirement years, and potentially higher taxes in the future.
Friday, December 5, 2008
The website http://statestats.appspot.com produces an interesting heat map based upon keyword searches on google by state. According to the heat map, the Top 5 states that search for "unemployment" are:
- Oregon (Which had a 7.3% unemployment rate in Oct. 2008)
- New York (Which had a 5.7% unemployment rate in Oct. 2008)
- Nevada (Which had 7.6% unemployment rate in Oct. 2008)
- Pennsylvania (Which had a 5.8% unemployment rate in Oct. 2008)
- Washington (Which had a 6.3% unemployment rate in Oct. 2008)
The Chart is interesting, but it states the obvious, states with high rates of unemployment (or increasing job losses--like financial jobs in New York) are the "hot zones" in the heat map. States with low rates of unemployment are in the "cold zones"
As you can see in the chart above the 1-month "net change" in employment continues to worsen.
When the figure is below "0" that means jobs were lost vs. the month prior, and we've been losing jobs from January 2008 to the present day, at an increasing rate. It's interesting to note that this coincides to the now declared "December 2007" start of the recession we are now experiencing.
Another interesting point is that there are 600,000 more people who are out of work but not counted as unemployed, if you compare November 2008 to November 2007. There can be several reasons why they are considered "unemployed", but typically it's things like being discouraged and stopping an active job search or going back to school.
Thursday, December 4, 2008
Frequently, you will hear folks like Ben Bernanke and Barack Obama say that "2008 is different than the depression because now unemployment is mid-single digits and back in the depression unemployment was 25%."
Well that's a true statement---It fails to note that back during the market crash of 1929, the unemployment rate was single digits. However, that quickly rose for the next 4 years to a high of ~25%, and stayed high for over a decade.
Well I hope that we won't ever again see unemployment north of 20%, I do think that we will see the negative feedback loop continuing as institutions and individuals de-lever and cut back on investment & spending. This will result in fewer jobs and perhaps a multi-year bout of double-digit unemployment.
Wednesday, December 3, 2008
Wednesday, December 3, 2008, 8:15 A.M. ET
Nonfarm private employment decreased 250,000 from October to November 2008 on a seasonally adjusted basis, according to the ADP National Employment Report®. The estimated change in employment from September to October was revised down from a decrease of 157,000 to a decrease of 179,000. Note that the November ADP Report does not reflect the strike of some 27,000 machinists who returned to work following the resolution in late October of a strike in the aerospace industry.
November’s ADP National Employment Report offers evidence of a labor market that continues to weaken. This month’s employment loss was again driven by the goods-producing sector which declined 158,000 during November, its twenty-fourth consecutive monthly decline. The manufacturing sector marked its twenty-seventh consecutive monthly decline, losing 118,000 jobs. These losses were compounded by an employment decline in the service-providing sector of the economy which fell by 92,000, the second monthly loss in the service-providing sector recorded by the ADP Report since November of 2002.
Read the rest of the report here.
Tuesday, December 2, 2008
California unemployment jumps to 8.2%, third-highest in the U.S.
November 22, 2008
The state's economy shed 26,400 people from its payroll last month, raising the total number of lost jobs to 101,300 since October 2007, the California Employment Development Department reported Friday.
Read the rest of the story here
Monday, December 1, 2008
It's also interesting to note how quickly the cycle spikes up, and how slowly it decays.
By Patrick Thornton
For the Wausau Daily Herald
New unemployment claims are growing at a rate of 30 percent from last year, and the state likely will run out of money to pay benefits by early next year.
Wisconsin has an estimated $374 million in the unemployment insurance reserve, money used to pay displaced workers who qualify for unemployment benefits. For the first time since 1982, the state will need to borrow money from the federal government to make payments, said Dick Jones, a spokesman for the state Department of Workforce Development.
The fund is supported by money from employers, but there is more money going out in this weak economy, Jones said. During the week of Nov. 17, the state received 17,591 new unemployment claims, up 6,500 from the same week last year.
"We have been consistently saying that the country is in the middle of a major economic crisis, which presents major challenges for all of us," Jones said. "And things may get worse before they get better."
People who qualify for unemployment will continue to receive payments. This week, Gov. Jim Doyle extended the time someone can collect unemployment. The state pays for 26 weeks of unemployment, and the federal government will pay for an additional 20 weeks.
Louis Rozner was laid off in October after 25 years working for the town of Plover. At 55 years old, he worries he is too close to retirement age to be attractive to a potential employer.
"I'm still in shock, a month later," he said. "I'm looking for work, and there's not a lot out there, from what I'm finding."
Sally Cutler, executive director of the North Central Wisconsin Workforce Development Board in Wisconsin Rapids, expects more layoffs after Jan. 1. But she said job loss can be an opportunity.
"For people who weren't working at their full potential, it's a chance to regroup and assess their skills and get some new training to help them get the positions that are out there," she said.