As the U.S. economy slows down, we would expect to start to see evidence of this in the employment numbers, and that is precisely what has begun to happen. During the week before last, initial claims for unemployment benefits jumped by 17,000, which was the largest increase that we had seen in over a year. Well, last week we witnessed an even bigger spike. Seasonally adjusted initial claims shot up 20,000 more to a total of 294,000. Of course it makes perfect sense that more Americans are applying for unemployment benefits, because firms are laying people off at a much faster pace these days. Just a couple days ago I reported that job cut announcements at major firms are running 24 percent higher this year compared to the first four months of last year. So we should fully expect that the number of Americans seeking unemployment benefits will continue to accelerate.
Personally, I am a bit surprised by how quickly these numbers are getting worse. The following comes directly from the Department of Labor…
In the week ending May 7, the advance figure for seasonally adjusted initial claims was 294,000, an increase of 20,000 from the previous week’s unrevised level of 274,000. This is the highest level for initial claims since February 28, 2015 when it was 310,000. The 4-week moving average was 268,250, an increase of 10,250 from the previous week’s unrevised average of 258,000.
For a long time, initial claims for unemployment benefits were running quite low, and this was one of the few bright spots for the U.S. economy.
Unfortunately, that is now changing, and this is just more confirmation that a significant economic slowdown has already started. For many more numbers that back up this claim, please see my previous article entitled “11 Signs That The U.S. Economy Is Rapidly Deteriorating Even As The Stock Market Soars“.
But whether the economy has been doing good or bad in recent years, the long-term trend of the decline of the middle class in America has continued unabated.
This week, we got even more evidence that the middle class is steadily disappearing from the Pew Research Center…
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