In each Economic Update, the Research staff analyzes recently released economic indicators and addresses what these indicators mean for REALTORS® and their clients. Today’s update discusses jobless claims.
- Businesses appear to continue to preserve jobs as filings for initial unemployment insurance claims dropped for the third week in a row. Initial claims for the week ended November 3 dropped by 8,000 claims to 355,000. Note, however, that the data is preliminary and subject to revisions, generally upward, the following week. Job loss claims have been trending down, albeit slowly, but they are heading towards the pre-recession mark of about 300,000 claims per week, barring any major adverse economic event.
- Meanwhile, the number of unemployed who have filed continuing claims stood at 3.127 million as of the week ending October 27. This is about half the peak level in 2009, although still above the pre-recession mark of about 2.5 million.
- Notwithstanding the gains, the economy would have to go beyond preserving existing jobs, and needs to vigorously create new jobs, in the order of about 250,000 a month to significantly bring down the unemployment rate to close to 5 percent. To note, the economy generated only 171,000 net new jobs in October, so major policy changes are needed in the new Congress to bring this to effect. This includes addressing the fiscal cliff issue, keeping mindful of the impact on growth and job creation. For 2012, NAR projects 1.7 million net new jobs that will underpin the 4.64 million of existing home sales.