US jobless claims rise, but backlog distorting data

Initial claims for benefits increased 15,000 to a seasonally adjusted 309,000

Job seekers stand in a line at a career fair in Chicago. Photographer: Tim Boyle/Bloomberg
Job seekers stand in a line at a career fair in Chicago. Photographer: Tim Boyle/Bloomberg

The number of Americans filing new claims for jobless benefits rose last week, but it was difficult to get a clear read on the labour market's health because a Labor Department analyst said two states appeared to be working through a backlog of unprocessed claims.

Initial claims for state unemployment benefits increased 15,000 to a seasonally adjusted 309,000, the Labor Department said today.

Claims data have been thrown into disarray since an update in government computer systems in California and Nevada created a backlog in the processing of new claims two weeks ago.

That initially led to a sharp decline in new processed claims earlier this month, and a Labor Department analyst said the two states still appeared to be working through the backlog, which he said could take another week or two.

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If taken at face value, the data hinted at a pickup in hiring during September. The data was collected during the same week the Labor Department surveys employers for its monthly employment report.

At 314,750, the four-week average was about 5 per cent lower than it was during the employment report’s survey week in August, when employers added a lackluster 169,000 jobs to payrolls.

However, even that reading, which smooths out weekly volatility, could rise in coming weeks if a backlog of claims continues to be cleared. (Reuters)