Trend watch and what’s new this week
While the U.S. is not out of the woods for COVID-19, the delta surge has clearly passed. New infections have dropped 30% and the number of hospitalizations are down 18% (slide 3). The rate of deaths has also crested. New cases in the hotspot states (slide 7) are down over the same span.
We continue to highlight school-age children (ages 5-17). New cases in the 5-11 age group are still climbing, but stable for the 12-15 and 16-17 age groups (slide 8).
Initial claims for state-level unemployment insurance (UI) benefits fell to 298,300 (not seasonally adjusted) in the most recent week. This count is the number of workers asking for UI. The pre-pandemic 3-year average was 227,000. Thus, new state-level UI claims are roughly back to pre-pandemic range (see slide 9). Initial UI claims are an excellent leading indicator and bode well for further improvements in employment.
Lastly, we updated the consumer spending trends based on credit/debit card data through mid-September (slide 10). We also show spending by category. Despite the surge in infections during July and August due to the delta variant, the spending data illustrates the strength and resilience of consumers.
Overall economic activity is increasing again based on the incoming data, including staffing, freight volumes, restaurant data, air travel, and hotel occupancy. This is corroborated by upward surprises by both of the main monthly manufacturing gauges for September and bolstered by fewer initial UI claims.
Yet, this same data also highlights the continued unevenness by region and city. As the many recent cross-currents—including the delta variant surge, Hurricanes Ida and Nicholas, the Labor Day holiday and seasonality—recede further in the coming weeks, some of those regions, such as Louisiana and New Orleans, should help contribute to the overall improvement in the fourth quarter.
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