In a blog posting at CNBC, Tony Fratto asks the question "Do Long Term Unemployment Benefits Elevate the Unemployment Rate?" He provides the graph below, purportedly showing that the current recession is unique, in that "weekly initial claims for unemployment insurance are very tightly correlated with the unemployment rate – until mid-2009, that is..."
Looking at that data, you might find yourself thinking that it is, in fact, strange that well into the recession there is a sudden dislocation between the two measures. And, look! There was no similar dislocation in the 2001 recession. It must be that there is something different about the current recession that is affecting unemployment. And it must be something that occured later in the recession. Therefore, it must be that we extended unemployment benefits longer than in past recessions. Quod erat demonstrandum!
Only did we really demonstrate that?
First, there's no cause/effect argument that would tell us that the unemployment rate should drop as soon as initial claims start to drop. Just because fewer people are losing their jobs doesn't mean a lot of unemployed are being rehired.
Second, the 2001 recession was relatively short and shallow compared to the current recession. What if we looked for more data?