More media spin on unemployment
posted at 11:36 am on March 11, 2010 by Ed Morrissey
New jobless claims dropped an entire 1.2% from last week to this, 6,000 down from 468,000 last week. The new figure is slightly higher than analyst expectations, but either way, it’s basically statistical noise from a relatively constant level of joblessness. How did the AP report it today? Guess:
The number of newly laid-off workers requesting unemployment benefits slipped last week, the latest sign the employment picture is slowly brightening.
The Labor Department said initial jobless claims fell by 6,000 to a seasonally adjusted 462,000. That’s close to Wall Street analysts’ estimates of 460,000, according to Thomson Reuters, and the second straight drop.
The figures come after other mildly positive news on employment. Job openings rose in January to their highest level in almost a year, the department said on Tuesday. And the unemployment rate was unchanged at 9.7 percent in February, the department said last week, better than analysts expected. The jobless rate hasn’t risen since October.
Last week’s news wasn’t “mildly positive” at all. It was a continuation of bad news. The reason the overall rate didn’t go upward wasn’t because job losses had stabilized but because of movement of discouraged workers out of the work force. The U-6 category, combining the unemployed with the marginally attached workers and part-time workers who want to work full time, had dropped from 17.4% in October to 16.5% in January. It went back up to 16.8% in February, as did the U-4 number from 10.3% to 10.4%.
This report also uses the weather for a reason for the increases in unemployment in February, but fails to explain how that’s still impacting initial jobless claims more than three weeks later. After all, these are people losing their jobs now, not three or four weeks ago. Three months ago, new jobless claims hit their low mark of 434,000, and we’re now up 6.5% over that on a weekly basis. That’s not due to storms or the weather (remember, this data is seasonally adjusted anyway) but to a stagnant economy that’s not producing jobs. Also, February’s weather wouldn’t have impacted the longer-term U6 and U4 numbers.
There isn’t much difference between 462,000 and 468,000 in new jobless claims week to week for any rational analysis. While it’s an improvement to the 6,000 who didn’t lose jobs this week, it’s otherwise a status quo. Until that number gets to around 325,000, we will not be experiencing any net job creation, and that’s the only “brightening” for which we’re looking.