unemployment

The news from initial unemployment claims is good:

In the week ending Feb. 26, the advance figure for seasonally adjusted initial claims was 368,000, a decrease of 20,000 from the previous week's revised figure of 388,000. The 4-week moving average was 388,500, a decrease of 12,750 from the previous week's revised average of 401,250.

I think of 400,000 as the dividing line between a labor market this is moving in the right direction and one that has not regained its strength after a recession.  That's where we were in the past two jobless recoveries following recessions not induced by the Fed to halt inflation. Here's the historical data -- take a look for yourself:

       Let's stipulate right up front: it's silly to infer much from one month of job-creation numbers.  The numbers bounce erratically, they are often revised dramatically one month later and they routinely  defy the consenus forecasts by a wide margin. 

      Last month, forecasters were surprised and the media were elated when the Labor Department reported that job losses dwindled to just 11,000 in November -- much lower than expected (and revised today to a net gain of 4,000).  The newly exhuberant forecasters were surprised again on Friday, when the estimated job losses in December jumped back up to 85,000.  

       "U.S. Job Losses Dim Hopes for Quick Upswing," declared a headline in The New York Times.  I'm not sure how much hope there was for a quick upswing, but I'm even less convinced that the new job numbers change the picture all that much. 

      But here's what's interesting: the Fed's policy under Ben Bernanke seems intentionally geared to high unemployment for the next several years.