by Calculated Risk on 5/29/2008 10:08:00 AM

Earlier this month, continued unemployment claims exceeded 3 million for the first time in four years. Now the continued claims have passed 3.1 million (see first graph).

Here is the data from the Department of Labor for the week ending May 24th.

Click on graph for larger image.

The first graph shows the continued claims since 1989.

Clearly people losing their jobs are having difficulty finding new jobs.

Notice that following the previous two recessions, continued claims stayed elevated for a couple of years after the official recession ended - suggesting the weakness in the labor market lingered. The same will probably be true for the current recession (probable).

The second graph shows the weekly claims and the four week moving average of weekly unemployment claims since 1989. The four week moving average has been trending upwards for the last few months, and the level is now solidly above the possible recession level (approximately 350K).

Labor related gauges are at best coincident indicators, and this indicator suggests the economy is in recession.