For the week ending Oct. 5, seasonally adjusted initial claims for unemployment compensation rose to 374,000, the Department of Labor
reported Thursday. That was an increase of 66,000 from the previous week's unrevised figure of 308,000 and the highest level since a spike in claims in March. While most official economic reports have been halted because of the government shutdown, the unemployment claims are reported by the states, not the feds.
Experts had predicted claims for the week of 310,000-312,000. For the comparable week of 2012, claims were 352,000. The four-week running average, preferred by analysts because it flattens volatility in the weekly numbers, rose 20,000 to 325,000 against the previous week's unrevised average of 305,000.
A department analyst said about half the weekly increase stemmed from continuing problems with a computer upgrade in California. The state has under-reported claims for the past two weeks. Another quarter of the claims were attributed to non-federal employees being laid off because of the federal shutdown. Laid-off federal employees apply for claims through the states, but they are paid through a separate fund. Shutdown-related claims of federal employees will be reported next Thursday:
Figures from local officials, however, indicate federal employees are filing in droves. The District of Columbia has received more than 11,000 applications from federal workers in the first seven days that they could apply for benefits, a spokeswoman said. That is nearly ten times the number of federal claims filed nationwide the week before the shutdown. The District of Columbia, Maryland and West Virginia have all increased staffing or paid overtime to keep up with the federal claims.
For both state programs and the federal emergency unemployment compensation program begun because of the heavy impact of Great Recession, total continuing claims for the week ending Sept. 21 was 4,028,411. That was an increase of 25,956 from the previous week. For the comparable week of 2012, 5,044,649 persons claimed benefits in state and the federal EUC programs. The drop is a function of people getting jobs, exhausting their benefits or leaving the workforce.
Because the federal Bureau of Labor Statistics did not release its monthly jobs report Friday, Oct. 4, the claims report takes on a bit more importance as the only official measurement of the job situation even though its value as a predictor of job growth has waned significantly in the past couple of years.
In the aftermath of the most recent previous recessions, when the claims level fell to 400,000 a week, job growth returned a healthy level. That hasn't happened after the Great Recession even though the weekly average since last October has fallen to 360,000.