by Calculated Risk on 4/21/2020 02:16:00 PM

We will probably see a decline in initial weekly unemployment claims this week. The consensus is initial claims will decrease to 4.145 million, from 5.245 million last week. That is still a huge number of initial claims.

The extremely high level of claims will probably continue for several weeks. But it will be important to track Continued Claims too - since many of these people won't be returning to work for some time.

Click on graph for larger image.

Here is a graph of continued claims since 1967.

At the worst of the Great Recession, continued claims peaked at 6.635 million, but then steadily declined.

Continued claims have already increased to a new record high of 11,976,000 (SA) and will increase further over the next few weeks.

During the Great Recession, initial weekly claims were a helpful measure of the recovery.   Although weekly claims will likely remain elevated for some time, they will decline significantly from the recent levels.

This time it will be more important to track continued claims as a measure of the eventual recovery -  - since continued claims are likely to stay at a high level until the crisis abates.