The second week of the shutdown brought in fewer initial jobless claims, but the shutdown wasn’t the main problem last week, either. The Department of Labor reported 358,000 initial jobless claims last week, down 15,000 from the week before but still artificially high due to a backlog in California:

In the week ending October 12, the advance figure for seasonally adjusted initial claims was 358,000, a decrease of 15,000 from the previous week’s revised figure of 373,000. The 4-week moving average was 336,500, an increase of 11,750 from the previous week’s revised average of 324,750.

The advance seasonally adjusted insured unemployment rate was 2.2 percent for the week ending October 5, unchanged from the prior week’s unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending October 5 was 2,859,000, a decrease of 43,000 from the preceding week’s revised level of 2,902,000. The 4-week moving average was 2,875,750, an increase of 17,750 from the preceding week’s revised average of 2,858,000.

Economists expected the number to fall more:

Jobless claims decreased by 15,000 to 358,000 in the week ended Oct. 12 from a revised 373,000 in the prior period, a Labor Department report showed today in Washington. The median forecast of 46 economists surveyed by Bloomberg called for a decrease to 335,000. Applications in California remained elevated and last week’s total also included some non-federal workers dismissed due to the gridlock in Washington, a Labor Department spokesman said as the figures were released.

The shutdown would have furloughed federal workers and contractors, making at least the latter eligible for jobless benefits.  The big surge in those applications came a week earlier, but that wasn’t the only surge that pushed the initial jobless claim levels back to 373K, nor were the previous weeks’ years-long lows accurate, either.  California and Michigan have begun working through their backlog of uncounted claims, which has skewed the data for weeks:

California and Michigan continued to sift through backlogged claims held up by computer changes. Furloughed private-sector workers drove up applications by 15,000 two weeks ago. About 70,000 furloughed federal employees also sought benefits in the week ending Oct. 5, although those workers aren’t included in the overall totals. …

The government opened for business on Thursday. Federal employees who receive back pay will likely have to reimburse the government if they claimed unemployment benefits during the two-week shutdown, although the law varies by state.

Before the government shutdown and California’s backlog, applications fell to a six-year low three weeks ago, thought that figure was pushed lower by California’s delays.

Besides, while this series has been a decent indirect measure of job creation when viewed over a longer period — more than the four-week average, certainly — the indirect connection between this measure and job growth has disappeared in the Great Stagnation:

Falling applications for unemployment benefits are typically followed by more hiring. But so far, there haven’t been many signs of that happening.

Steve Eggleston estimated that the real level of this measure over the last several weeks was probably 320,000, give or take a few each week.  In other words, the real figure (outside the shutdown) has probably been steady, and only has spiked or plunged due to artificial events and not anything reflective of real hiring trends.

When might we see the September jobs report, originally due two weeks ago but delayed by the shutdown?  The survey work was completed perhaps as long as a month ago, and the only thing needed now is the report.  It should come out soon, perhaps as soon as tomorrow, although that may be a little optimistic.