There has been a lot of ink, most of it misleading, regarding a huge spike in hurricane-related initial unemployment claims.

I discussed charts of the data in my previous post, Initial and Continued Unemployment Claims Surge, a Cause for Alarm?

Understanding the Lead Chart

The problem with continued claims is that benefits in 48 of 50 states expire after 26 week. Once a person hits 27 week, they are still unemployed but they have no claim.

To address this issue, I add those unemployed 27 weeks or more to continued claims.

Since claims are weekly, I compute a monthly average (not a 4-week moving average) of continued claims and add that to the monthly total of those unemployed 27 weeks or more.

The slope of the total rise (blue) is stunning vs the continued claims rise (red).

Unemployment Level 15+ Weeks and 27+ Weeks

If that does not look concerning, then you don't know how to read a chart.

History suggests that once a person hits 15+ weeks they do more than the distance to no unemployment insurance.

The BLS defines the U-1 Unemployment rates as the percentage of people unemployed 15 weeks or longer.

The recent spike is obvious. And at 15 weeks no one can blame this on hurricanes.

McKelvey Type Recession Indicator

From these 3-month moving averages, we can create a McKelvey style recession indicator comparing a rise in the three-month moving average of 15+ weeks to a prior