WASHINGTON — Initial claims for U.S. state unemployment benefits rose by 46,000 to 388,000 in the October 13 employment survey week after falling sharply in the previous week, the Labor Department reported Thursday.

A Labor Dept. analyst said that the claims data is being distorted by an issue of the timing of claims and that the actual level of claims being reported is about what has been expected.

In the October 6 week the analyst said that they had expected California to report additional claims usually associated with a new quarter. However, California reported those claims in the October 13 week instead.

The median estimate of economists surveyed by MNI was for 365,000, an increase of 26,000 from the initially reported 339,000 level in the October 6 week. That week's claims level was revised up 3,000 to 342,000.

The state data released for the October 6 week indicated unadjusted initial claims increased in 49 states and declined in 4 states, with zero states unchanged. The District of Columbia, Puerto Rico, and Virgin Islands are included in this data.

In the October 6 week, California was the only state that reported a decline in claims over 1,000 with a drop of 4,979 in unadjusted claims.

The current week's level of initial claims was 3,000 higher than the 385,000 level in the September 15 employment survey week.

A Labor Department analyst said that seasonal factors expected a decrease of 3.9% in unadjusted claims in the October 13 week. Instead, unadjusted claims rose 8.8% to a level of 359,048 in the current week. Unadjusted claims were at a level of 357,562 in the comparable week a year ago.

The initial claims seasonally adjusted 4-week moving average was 365,500 in the October 13 week, and increase of 750 from the previous week.

Continuing claims came in at 3.252 million after seasonal adjustment in the October 6 week, a drop 29,000 from the previous week.

Unadjusted continuing claims fell by 40,882 to 2,744,348 in the week, and remains below the 3,133,644 level in the comparable week a year ago.

The seasonally adjusted insured unemployment rate fell to 2.5% after holding at 2.6% since March. The seasonally adjusted unemployment rate is still down from the 2.9% rate in the comparable week a year earlier.

The unemployment rate among the insured labor force is well below that reported monthly by the Labor Department because claims are approved for the most part only for job losers, not the job leavers and labor force reentrants included in the monthly report.

The Labor Department said that the level of unadjusted Emergency Unemployment Compensation benefits claims fell by 7,279 in the September 29 week, bringing that category total to 2,098,793.

Extended benefits claims rose by 59 to 35,245 in the September 29 week.

The extended benefits program pays claims after a person has exhausted regular unemployment benefits and the four tiers of Emergency Unemployment Claims. The program provides benefits for an additional 13 weeks but some states can volunteer to pay extended benefits for an additional 7 weeks for a total of 20 weeks.

The extended benefits program can be triggered if a state has an unemployment rate above 8% and is more than 110% of that state's unemployment rate in one of the three previous years. New York is the only state currently eligible for this program.

The Labor Department reported that a total of 5,001,985 persons claimed unemployment benefits in the September 29 week, a decrease of 42,664 from the previous week and still well below the 6,694,493 persons in the comparable week a year ago. These data are not seasonally adjusted, and include regular state claims, federal employee claims, new veterans claims, the EUC and extended benefits programs, state additional benefits, and STC/Workshare claims.

Market News International is a real-time global news service for fixed-income and foreign exchange market professionals. See www.marketnews.com.

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