Initial jobless claims, which are a measure of the number of people recently laid off, fell by 30,000 to a seasonally adjusted 339,000 – however, one state, possibly California, underreported its data, according to a Fox News report
According to the labor department spokesman, claims numbers fell short because “the state left out a pile of unprocessed claims related to seasonal factors around the beginning of the fourth quarter, which began Oct. 1.”
According to the Fox News report, Stephen Stanley of Pierpont Securities summed up the data: “In short, this reading is worthless in terms of informing on the general economy.”
With national and presidential elections looming, some suggested that the unemployment books are being cooked in the last month before elections for political purposes.
On Friday, the Labor Department’s September jobs report claimed unemployment in the country had dropped to 7.8% from 8.1% in August. The lower unemployment report came amid reports of factory slowdowns and weak national exports.
California is one of the only states large enough to taint unemployment figures by underreporting; however the Labor Department did not name the rogue state. The spokesman did tell Fox Business “that this large state has a history of reporting “volatile” numbers at the beginning of quarters and that the Labor Department has complained and tried to work with the state to more accurately report its claims but with little success,” as quoted from the Fox Business report
It is believed that the state in question has under-reported its new unemployment claims by 30,000 for September, which would make the real September unemployment number climb to 369,000.
Economic analysts predicted 370,000 new unemployment claims last week. The four-week moving average of unemployment benefit claims, a more accurate gauge, fell to 364,000, without factoring in the underreported claims from the Labor Department’s mystery state.