Jobless Claims JUMP to 439,000
First time unemployment claims took a flying leap this week. The jobless claims surged over 78,000 to a staggering 439,000 across the U.S. The government economists were expecting numbers in the 375,000 range.
Many of the media are blaming this shocking increase on the Superstorm Sandy.
Bloomberg: “Based on previous extreme-weather episodes, we typically see the associative claims coming in over several weeks,” Jim O’Sullivan, chief U.S. economist for High Frequency Economics Ltd. in Valhalla, New York, said before the report. “It’s not a booming labor market, but it is a recovering labor market. Certainly prior to the storm, there was no sign that there was any deterioration.”
MSNBC: An analyst from the department said several states from the mid-Atlantic and Northeast reported large increases in claims due to Sandy, a mammoth storm that slammed into the East Coast in late October.
But are they right?
A quick review of the Department of Labor’s website might indicate otherwise:
The largest increases in initial claims for the week ending November 3 were in Pennsylvania (+7,766), Ohio (+6,450), New Jersey (+5,675), Michigan (+2,373), and Connecticut (+1,783), while the largest decreases were in California (-8,149), New York (-2,241), Florida (-939), Georgia (-913), and Indiana (-603).
While hard hit New Jersey did have a sizable increase probably attributable to the storm, the state of New York actually reported a decrease in claims.
The highest numbers of new filings came from Pennsylvania and Ohio, where there were thousands of layoffs in the construction, manufacturing, and automobile industries.
Those who watch the unemployment claim numbers have questioned recent reports and whether they were skewed to help the presidential election. Today’s numbers are causing many to ask, “Are we on the road to recovery, however slow and sloggy it might be? Or are we headed back into a recession if not a depression?”