High unemployment claims might signal that additional stimulus is required

The Department of Labor's initial unemployment insurance claims data released this morning show that 825,000 people applied for unemployment insurance in the week ended September 19 (not seasonally adjusted), and 635,000 applied for Pandemic Unemployment Assistance (unemployment for gig workers).

For a quick reaction, Bloomberg's Lisa Abramowicz tweeted 

"The data is messy, but the latest U.S. jobless claims comes in worse than expected. Stock futures rollover, yields tick lower. This adds fuel to the debate over whether the US economy has enough momentum to keep recovering without additional fiscal support."

26 million people are currently receiving unemployment assistance.

Note: I cite the non-seasonally adjusted numbers because I don't know how to interpret seasonal adjustment when we are four times above the pre-pandemic unemployment claim levels that the seasonal adjustment factors are built on. If the seasonal variations on an absolute level (e.g., 10,000 workers) are pretty similar, they would be overestimated when using percentages (e.g., 5 percent would normally be applied to a number around 200,000 instead of 800,000). And some seasonal variations, such as a pre-Christmas increase in workers at Macy's, probably won't happen this year, even if there is a corresponding increase in workers elsewhere such as at Amazon distribution centers.