Jobless Claims Unexpectedly Rise to 388,000
The number of U.S. workers filing applications for jobless benefits rebounded last week, though numbers so far this month have been distorted by technical factors.
Initial jobless claims--which are a measure of layoffs--were up by 46,000 to a seasonally adjusted 388,000 in the week ended Oct. 13, the Labor Department said Thursday. Economists surveyed by Dow Jones Newswires had forecast 365,000 new applications for jobless benefits last week.
In the previous week, jobless claims dropped by 27,000 because of an unexpected shift in seasonal reporting by one state. That state--California--reported fewer claims than expected, which accounted for the large decrease. There were nearly 5,000 fewer layoffs in the service and retail industries in California for the week ended Oct. 6, according to the Labor Department report.
The Labor Department sets seasonal factors well in advance based on historical trends but that can skew numbers when state-level reporting doesn't match those established patterns.
"These types of things happen several times a year," a Labor Department official said Thursday. "It tends to be temporary."
Raw figures show claims typically drop toward the end of the quarter and spike at the start of the next quarter. A worker may decide to wait to file until the end of the quarter in an effort to boost his weekly check because the amount is based on a rolling average of income before the layoff. As a result, there can be a bulk of claims that are not processed until the turn of the quarter.
Claims for the prior week were revised up to 342,000 from an initially reported 339,000.
The four-week moving average of claims--which smoothes out volatile weekly data--rose by 750 to 365,500.
The U.S. labor market has been slow to recover since the recession, with steady but unspectacular job growth and high unemployment. The unemployment rate dropped to 7.8% in September, the lowest level since President Barack Obama took office in January 2009 but still well above figures from previous decades.
Thursday's jobless claims data showed the number of continuing unemployment benefit claims--those drawn by workers for more than a week--dropped by 29,000 to 3,252,000 in the week ended Oct. 6. Continuing claims are reported with a one-week lag.
The number of workers requesting unemployment insurance was equivalent to 2.5% of employed workers paying into the system in the week ended Oct. 6. That is the first time the rate has dropped below 2.6% since mid-March.
The Labor Department report on jobless claims can be accessed at: http://www.dol.gov/opa/media/press/eta/ui/current.htm.
Write to Sarah Portlock at sarah.portlock@dowjones.com and Jeffrey Sparshott at jeffrey.sparshott@dowjones.com.