However, continuing claims in the week ending May 16 reached a record high for the 17th consecutive week at 6.788 million. Continuing claims are representative of those that are still receiving unemployment benefits. Although the weekly initial claims figures have declined, the continued rise in continuing claims is troublesome as more an more workers remain unemployed. At the end of recessions, the continuing claims figure typically moderates as workers begin finding employment. So far this data point shows no moderation.
To gain some perspective on our current unemployment rate and recession versus previous downturns, below are a couple of Bureau of Labor Statistics graphs. The first showing the acceleration in the unemployment rate (%) since the beginning of last year... (Click on graph for full size image)
...and the unemployment rate (%) from 1970 until April 2009.
As you can see we are close to the level reached in the mid 1970's recession, but still below the peak level reached in the early 1980's recession. However, we are well above both unemployment levels reached in the past 20 years. While the Federal government has the unemployment rate peaking around 10% later this year, some economics believe the number could reach as high as 12% before the recession ends. It should noted that the government stress tests for the banks were based on unemployment of 10%, so a number above 10% could have an adverse impact on US banks' capital requirements.
