May 5, 2011

Integrity in reporting: latest jobless claims news item doesn't show it.

The most recent weekly jobless claims 'unexpectedly' rose to an 8 month high, of 474,000 last month.  But not so unexpectedly, someone had a ready, but not entirely plausible explanation for it.

With data hinting at a slowdown, no surprise given the phony government spending bulge that made the last  quarters look a little more rosy, the latest jobless claims lend credence to the idea maybe this recovery isn't as massive as a Recovery Summer II advocate would have you believe.

First, the unexpected bit;
While the surprise jump in initial claims for unemployment benefits was blamed on factors ranging from spring break layoffs to the introduction of an emergency benefits program, economists said it corroborated reports this week indicating a loss of momentum in job creation.

New claims for state jobless benefits rose 43,000 to 474,000, the highest since mid-August, the Labor Department said on Thursday. Economists had expected claims to fall.
Next the incongruous bit (emphasis added);
The claims data fell outside the survey period for the government's employment report for April, which will be released on Friday and is expected to show the jobless rate holding at a two-year low of 8.8 percent.
And the explanation bits:  One that speaks to actual softening -
"We do not think that the entire rise in claims over the last month can be explained by special factors alone," said Harm Bandholz, chief U.S. economist at UniCredit Research in New York. "It seems instead as if the improvement in the labor market slowed a bit."
followed by one that tries to find blame, in 'special factors';
A Labor Department official said spring break layoffs in New York added about 25,000 to the jobless benefit rolls last week. He said the start of an emergency benefits program in Oregon also helped lift the number of claims.

Many states in the Northeast allow for non-teaching staff to file for unemployment benefits when schools close for spring and summer breaks. The department tries to adjust its figures to take into account these seasonal fluctuations but New York's spring break occurred at an unusual time this year.

Tornadoes that struck parts of the country could also have accounted for a small number of claims.
and this piece de resistance;
One factor that likely helped push claims up and that could prove lingering were auto layoffs brought about by supply disruptions from Japan's earthquake and tsunami.
Those three factors combined maybe, MAYBE, make up the jump from 431,000 to 474,000. But even if it had stayed the same, 431,000 additional jobless claims is a very weak number. The Obama recovery, is simply not a recovery yet. If the jobless numbers stay at 8.8% I have to figure the fix is in, not just with reporters but with the BLS. That would make two groups, on the same story whose reports you could not trust.

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