Distorted Data Leaves U.S. Jobless Claims High

Washington (AFP) – U.S. claims for unemployment insurance remained elevated well above the trend Thursday due to the two-week government shutdown and California’s data backlog.

Initial jobless claims for the week ending October 12 numbered 358,000, down by 15,000 from the previous week’s 373,000 but well above the four-week trend of 336,500, the Labor Department said.

The numbers were likely pumped up by a surge in applications for unemployment insurance by federal employees given furloughs because of the partial government shutdown that began on October 1 and ended Wednesday.

The data was not broken down for this week, but in the previous week, the first week of the shutdown, more than 70,000 federal employees filed for jobless benefits, compared with fewer than 1,400 the week before the shutdown.

Also elevating the data was the reporting of backlogged claims from California, where systems problems earlier had slowed reporting.

Analysts said those issues made it difficult to discern any real trend in layoffs and hiring around the country from the numbers.

“Excluding those two special factors, we do not believe the trend is any higher than it was in August — before the delays in California — but we don’t know that for sure,” said Jim O’Sullivan at High Frequency Economics.

AFP Photo/Justin Sullivan