It’s funny what happens to a data series when consistency returns to its collection. Last week’s weekly jobless claims numbers dropped dramatically to nearly a four-year low, but later it was discovered that one large state didn’t report all of its claims properly. This week, the level returns to the same range we’ve seen since the spring of 2011:
In the week ending October 13, the advance figure for seasonally adjusted initial claims was 388,000, an increase of 46,000 from the previous week’s revised figure of 342,000. The 4-week moving average was 365,500, an increase of 750 from the previous week’s revised average of 364,750.
The advance seasonally adjusted insured unemployment rate was 2.5 percent for the week ending October 6, a decrease of 0.1 percentage point from the prior week’s unrevised rate. The advance number for seasonally adjusted insured unemploymentduring the week ending October 6 was 3,252,000, a decrease of 29,000 from the preceding week’s revised level of 3,281,000. The 4-week moving average was 3,275,500, a decrease of 5,750 from the preceding week’s revised average of 3,281,250.
The Associated Press confirms that California bolloxed up the works, and that the data series is back on track:
Weekly applications for U.S. unemployment benefits jumped 46,000 last week to a seasonally adjusted 388,000, the highest in four months. The increase represents a rebound from the previous week’s sharp drop. Both swings were largely due to technical factors. …
Last week, California reported a large drop in applications, pushing down the overall figure to the lowest since February 2008. This week, it reported a significant increase as it processed applications delayed from the previous week.
A department spokesman says the seasonally adjusted numbers “are being distorted … by an issue of timing.”
In other words, nothing really changed. Initial jobless claims are being created at about the same relative pace as it has for at least the last 18 months; although this is the highest number we’ve seen in the last four months, it’s not statistically significant from the series to be exceptional. This series does not provide a direct correlation to job creation, but over time this data series does have some indirect correlation to the health of job creation in the economy. What this tells us over the long term is that the labor market is still stagnant.
Amusingly, CNBC initially had this story on its breaking-news ticker with the phrase “unexpectedly rises.”
This is perhaps the most expected rise we’ve seen in this data series, thanks to the widespread knowledge of the faulty data reporting in last week’s numbers.