Thursday, October 11, 2012

Manipulation of Jobless Claims?

This is very convenient for our chief executive. The U.S. Department of Labor reported a sharp drop in jobless claims this last week.
But the Labor Department spokesman said the numbers were skewed by one large state that underreported its data. The spokesman declined to identify the state, but economists believe California is the only state large enough to have such a significant impact on the overall numbers.

According to the spokesman, the reason that state’s claims numbers fell short was 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.

In a research note, Stephen Stanley of Pierpont Securities summed up the data: “In short, this reading is worthless in terms of informing on the general economy.”

. . . The spokesman said that the unprocessed claims are likely to show up in the numbers in the next week or two. “We should see some sort of catch up.”

Later Thursday, another Labor Department spokesman issued a statement in effort to clarify what the agency described as “confusion” over the data. The latter statement seemed to refute the department’s earlier explanation.

“The decline in claims this week was driven by smaller than expected increases in most states and because of drops in claims in a number of states where we were expecting an increase,” the statement said. “No single state was responsible for the majority of the decline in initial unemployment insurance claims.”
(See also here). California denies any wrongdoing.

California's Employment Development Department is headed up by Pam Harris. She is a Democrat.

No comments:

Post a Comment