AP: Jobless claims jump good news for hiring, or something

posted at 2:01 pm on July 11, 2013 by Ed Morrissey

When looking at the data for weekly initial jobless claims, there are a few things to keep in mind.  First, the series is only indirectly correlative to job creation, and individual data points mean very little.  Second, the correlative level for any significant job growth in the past has been around the 325,000 mark, based on years of data in the previous decade.  Third, the data in summer tends to be more volatile, thanks to temporary factory closures and retooling.

With all of that said, a jump in the number of claims is never a very good sign … unless you’re the Associated Press:

A jump in claims — in this case, 16,000 — is a sign of steady job gains? Their news report was similarly mystifying:

U.S. unemployment benefit applications rose 16,000 last week to a seasonally adjusted 360,000, although the level remains consistent with steady hiring.

The Labor Department said Thursday that the less volatile four-week average increased 6,000 to 351,750.

The weekly applications data can be volatile in early July because some automakers briefly shut down their factories to prepare for new models and many schools close. Those factors can create a temporary spike in layoffs.

The broader trend has been favorable. Applications have declined steadily in the past year, as companies have laid off fewer workers and stepped up hiring. In the past six months, employers have added an average of 202,000 jobs a month. That’s up from an average of 180,000 in the previous six months.

We’ll get back to monthly job-creation averages in a moment.  Market Watch had a more sober take on the report, emphases mine:

The number of people who applied for unemployment benefits in the first week of July jumped by 16,000 to a seasonally adjusted 360,000, marking the highest level in two months, the Labor Department said Thursday. Economists polled by MarketWatch had expected claims – a proxy for layoffs – to rise to 349,000 in the week ended July 6 from a slightly revised 344,000 in the prior week. The claims report often seesaws in July because of shutdowns at auto plants for retooling and temporary layoffs related to the end of the regular school year. The July 4 holiday can also skew the data. The less volatile four-week average of claims rose a smaller 6,000 to 351,750 and reflected little change in the U.S. labor market.

Holidays can play hob with data collection in this series, but in this case, none of the states supplied estimates; all reported on actual claim numbers.  This increase isn’t a big jump in any case, and still puts the series in roughly the same 340K-360K range in which it’s been holding for the last several months.  The four-week average, which is a more reliable measure for correlative analysis, falls right into the middle of that range, although the move upward of 6K demonstrates the exact opposite of the AP’s analysis.

As far as the monthly averages go, they do show a small amount of gains being made, but it’s nearly insignificant in the scale of job creation needed to put a dent into the millions of sidelined workers.  The US economy needs to add 150,000 jobs a month just to keep up with population growth.  In order to catch up to the job losses over the last six years, we’d need to add between 6-8 million more jobs.  At the rate of growth highlighted by the AP as “steady job gains,” we’d need 10 years to reach the bottom end of that range.

In other words, this isn’t a signal of steady job gains. It’s another signal of ongoing stagnation.  That’s why Ben Bernanke continued to push Fed stimulus last night.

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Unexpectedly…

Drained Brain on July 11, 2013 at 2:07 PM

In other news, the IRS is hiring Imperial Storm Troopers new agents.

listens2glenn on July 11, 2013 at 2:08 PM

A jump in claims — in this case, 16,000 — is a sign of steady job gains? Their news report was similarly mystifying:

Copy and paste can bite you….

Ed, Have you looked at the JOLT piece over at ZeroHedge?

DoL is overstating the jobs numbers by as much as 40%….

dogsoldier on July 11, 2013 at 2:09 PM

We just wasted a hundreds of dollars on a bunch of loser applicants who failed their pre-employment drug/tox screen. What a friggin nuisance.

There are jobs out there. There are just too many losers trying to get them.

Capitalist Hog on July 11, 2013 at 2:16 PM

The claims report often seesaws in July because of shutdowns at auto plants for retooling and temporary layoffs related to the end of the regular school year. The July 4 holiday can also skew the data.

Ummm….OK, that’s why it is called “Seasonally Adjusted”. It isn’t rocket surgery people. If they keep this level of spin up, I fear for the Earth’s rotation.

Johnnyreb on July 11, 2013 at 2:20 PM

Keep in mind, that if the Senate immigration bill passed, you’d need to add 400K jobs a month over the next ten years to just keep up with population growth from all the new workers that will be admitted in that time frame.

Conservative in NOVA on July 11, 2013 at 2:23 PM

If this is reliable, it doesn’t seem unworthy of mention:


While part-time and temp jobs reached highs last month, full-time jobs decreased by another 240,000.

kunegetikos on July 11, 2013 at 2:24 PM

Obamalaise.

BuckeyeSam on July 11, 2013 at 2:28 PM

In other words, this isn’t a signal of steady job gains. It’s another signal of ongoing stagnation. That’s why Ben Bernanke continued to push Fed stimulus last night.

Well, the good news is if Bernanke ever steps in front of a bus or blows a brain or heart gasket, they can just replace him with a Disney animatronic of himself, endlessly repeating his statements of the last several years. It would save Obama the work of replacing him, and he could squeeze in another round of golf.

Marcola on July 11, 2013 at 2:29 PM

Second, the correlative level for any significant job growth in the past has been around the 325,000 mark, based on years of data in the previous decade.

That’s kind of bad data, these days, since we haven’t even seen anything close to 325,000 any time in the past 4 1/2 years – almost half of that decade of data. Well … there were those “strange anomalies” in the data during the campaign when they changed the definition of a full-time job and fabricated something like 600,000 joke jobs … But, other than that … the stagnation has been right on schedule.

ThePrimordialOrderedPair on July 11, 2013 at 2:29 PM

You can count on the AP spin like clockwork.This worked for awhile also.
http://www.calvin.edu/academic/cas/gpa/goebmain.htm

docflash on July 11, 2013 at 2:30 PM

If this is reliable, it doesn’t seem unworthy of mention:
While part-time and temp jobs reached highs last month,
full-time jobs decreased by another 240,000.
kunegetikos on July 11, 2013 at 2:24 PM

Remember, ObamaCares (TM).

Obamalaise.
BuckeyeSam on July 11, 2013 at 2:28 PM

Sounds like a fancy French sauce I’d never touch.
UPDATE: The IRS just said I’ll be forced to ingest it, either orally or… otherwise. See, I DO have a choice!

Marcola on July 11, 2013 at 2:36 PM

Have you looked at the JOLT piece over at ZeroHedge?
DoL is overstating the jobs numbers by as much as 40%….
dogsoldier on July 11, 2013 at 2:09 PM

Do you have a link for that, dog? I went to the zero hedge site and didn’t see it, but I could just be missing it. Thanks.

tommyboy on July 11, 2013 at 2:40 PM

After you have laid off all that you can you will not continue laying off because it causes too much lost production. The nation has surely reached this point but we see the numbers rise regardless. This should tell almost every thinking individual just how bad things are but we see the media trying to cheer lead don’t we? The same thing is happening in many categories; they tell us with great glee that there are the fewest number of home foreclosures in several years. Well, it doesn’t take a genius to realize that we are reaching a point of diminishing returns that says we are getting closer to the actual number that are not able to keep up the payments and it should level out. All of this is just common sense and natural occurrence. No the economy is not great and if, yes if, it is improving, it might be doing better if this government would just let it instead of trying to micromanage it. In addition, if government weren’t regulating to the level it is in obamacare and all other matters it would rebound faster than any of the experts would project.

Pardonme on July 11, 2013 at 2:40 PM

why Ben Bernanke continued to push Fed stimulus last night

Someone guessed: to push the stock market up at a record rate along with food stamp and other “social services” expenditures for the poor? While median household income continually declines?

Maybe she is wrong and Bernanke doesn’t keep track of stuff like that.

kunegetikos on July 11, 2013 at 2:49 PM

There are jobs out there. There are just too many losers trying to get them.

Capitalist Hog on July 11, 2013 at 2:16 PM

Relating to the Walmart / DC story – the libs are all crying that minimum wage isn’t enough. As you seem to indicate, a lot of these people aren’t even worth that much.

The cold hard truth is that a lot of people are just too doggone lazy, stupid, or unethical/immoral to be worth hiring – even at minimum wage.

dentarthurdent on July 11, 2013 at 2:53 PM

Today’s MSM makes Joseph Goebbels look like a rank amateur. They spin, lie and withhold information on a 7/24 basis. I think they receive bonuses based on spinning bad news to make Obama look good.

For example, the media really played up the increase in jobs in June, but few noted that full-time jobs fell while part-time positions (without benefits) grew significantly.

bw222 on July 11, 2013 at 2:58 PM

Same thing they try to sell about 3.50 gallon of gas. If fluctuates down a few pennies. Suddenly it’s cheap gas. If it goes up a bit, it’s because the strong economy is driving up the price of gas.

Red Creek on July 11, 2013 at 3:35 PM

The cold hard truth is that a lot of people are just too doggone lazy, stupid, or unethical/immoral to be worth hiring – even at minimum wage.

dentarthurdent on July 11, 2013 at 2:53 PM

That’s the truth. Far too many people have been led to believe they should be paid just for their mere physical presence on the job, let alone actually doing something, or anything, productive for most if not all of their shift, that is when they decide to come in to work at all, if they feel like it.

hawkeye54 on July 11, 2013 at 3:42 PM

Today’s MSM makes Joseph Goebbels look like a rank amateur. They spin, lie and withhold information on a 7/24 basis. I think they receive bonuses based on spinning bad news to make Obama look good.

Geobbels would be spinning in his grave with envy and pride, overjoyed that his influence in generating propaganda would, today, contribute to far exceeding his own contributions during his life.

hawkeye54 on July 11, 2013 at 3:44 PM

AP is nothing but a cheering section for The Obamassiah. Those whores wouldn’t know hard news if they fell over it.

GarandFan on July 11, 2013 at 3:49 PM

Relating to the Walmart / DC story – the libs are all crying that minimum wage isn’t enough. As you seem to indicate, a lot of these people aren’t even worth that much.

The cold hard truth is that a lot of people are just too doggone lazy, stupid, or unethical/immoral to be worth hiring – even at minimum wage.

dentarthurdent on July 11, 2013 at 2:53 PM

Good employees are priceless. You know that scene in every movie involving drug abuse when the addict gives up sex for drugs?

That’s how it is for employers and good employees. If you are worth the investment of vetting, hiring, training, promoting, bonuses you should take a moment and enjoy that fact. If you are correct in your assessment, your employer will reciprocate fairly. If he/she doesn’t but you believe you’re more valuable his competitor might be interested in your skill set. It’s always an employee’s market if you’re skilled, teachable and/or diligent.

Of course there’s a lot of competition for jobs. But what do you think your bosses are dealing with in their offices? Competition.

Also, in spite of what my snark might suggest I don’t see education as essential to success. Education is not essential to being employable. It helps but my best employees are not scholars by any stretch. Education is not essential; training is. There is a difference. Some aspects of business don’t need to be taught to employees especially trade secrets. Training, however, is key.

Capitalist Hog on July 11, 2013 at 4:00 PM

Every locale with “seasonally adjusted” reports of increased employment has somebody in charge who’s name is not followed by a “D”. When will the AP report that?

Freelancer on July 11, 2013 at 4:11 PM

Also, in spite of what my snark might suggest I don’t see education as essential to success. Education is not essential to being employable. It helps but my best employees are not scholars by any stretch. Education is not essential; training is. There is a difference. Some aspects of business don’t need to be taught to employees especially trade secrets. Training, however, is key.

Capitalist Hog on July 11, 2013 at 4:00 PM

Very true. My 20 year old son is 2 years out of high school, no college at all, just food industry work experience. A pizza restaurant he worked at for a year just hired him back (away from Costco) to be a salaried Assistant Manager.
My other son (22 year old) just graduated from college (business degree) and works for Enterprise as a Manager Trainee, at a salary just very slightly higher than his non-college educated younger brother.
Education may be a requirement for some jobs (Doctor, lawyer, engineer, etc) – but for most jobs it’s all about actual applicable work skills and work ethic.

dentarthurdent on July 11, 2013 at 4:30 PM

Also, in spite of what my snark might suggest I don’t see education as essential to success. Education is not essential to being employable.

There are CPA/CFPs, MBAs and engineers who report to me, several with more than a dozen years of industry experience. I have plenty of education, but no degree. Several of the junior analysts have clearer views of the information being processed than any of the “educated” mid-levels. If I was the hiring employer, degrees would begin to be almost as much of a liability as an asset, because too many of them barely learned how to learn, barely learned how to think, only learned how to regurgitate catch-phrases that make senior execs’ eyes light up.

Freelancer on July 11, 2013 at 4:58 PM

The number of jobless claims that evidences “a growing economy” seems to be subjective. This morning, for example, I was watching FNC’s early morning news (Bill Hemmer and Sally Rally, a.k.a. “Martha MacCallum”), and Sally was claiming — again — that claims under 375,000 were good news for the economy.

I dunno… sounds kind of like wishful thinking to me.

Spurius Ligustinus on July 11, 2013 at 5:22 PM

If this is reliable, it doesn’t seem unworthy of mention:

While part-time and temp jobs reached highs last month, full-time jobs decreased by another 240,000.

kunegetikos on July 11, 2013 at 2:24 PM

That was mentioned last week in the jobs report thread.

Steve Eggleston on July 11, 2013 at 6:56 PM