Forgetting the Government Shutdown, Jobless Claims Look OK
With the federal government in partial shutdown mode for the past 16 days, furloughing as many as 800,000 workers at one point, initial claims for unemployment benefits “are likely to be distorted for some time,” Raymond James chief economist Scott Brown told Bloomberg after last week’s report from the Department of Labor’s Bureau of Labor Statistics. Ironically enough, the jobless claims numbers provide such an important measure of the health of the United States economy that it was among the few pieces of data released by the government during the closure.
While falling off from the six-month high recorded for the week ended October 5, first-time jobless claims remained elevated the following week. According to data released by the BLS on Thursday, initial claims fell 15,000 to a seasonally adjusted 358,000 in the week ended October 12.
Thanks to a huge backlog of applications in California and the government shutdown, initial claims for unemployment benefits spiked to 373,000 in the week before that. In fact, the Labor Department said 70,068 government workers who were furloughed had filed claims by October 5, but the department’s analysts could not provide an estimate of how many of those claims could be attributed to the shutdown.
Analysts had been expecting a much larger decrease, with the consensus estimate set at a 38,000-claim decline.