Volatile First-Time Jobless Claims Jump Back Up

First-time claims for unemployment insurance jumped 38,000 to 368,000 for the week ending January 26, the ""Labor Department"":http://www.ows.doleta.gov/press/2013/013113.asp reported Thursday. Economists expected a smaller increase to 350,000 from the prior week's 330,000 initial claims.

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For the third straight week, the originally reported claims figure was unrevised. In the week ending January 19, claims dropped to a five-year low.

Continuing claims--reported on a one-week lag--rose 22,000 for the week ending January 19 to 3,197,000 from 3,175,000. Continuing claims for the week ending January 12 were revised up from the originally reported 3,157,000. The continuing claims data series tracks the number of longer-term unemployed who qualify for regular state jobless benefits.

The weekly jump in initial claims was the first in three weeks. It reflected, in part, a drop in the seasonal adjustment factor the Labor Department applies to the raw data, which includes holiday workers whose jobs were eliminated. This week's report also reflects a disruption for the Martin Luther King holiday, when many government offices were closed and unable to process claims that had been filed electronically. Holidays usually affect this data series more than others.

Even with the jump in claims, the largest week-over-week increase since November, first-time claims filings are beginning 2013 positively. Weekly filings have averaged 352,000 this year compared with 376,500 at the beginning of 2012. The January average is the smallest since January 2008's 338,250, just after the Great Recession began.

The four-week moving average for first-time claim filings was 352,000, up 250 from the previous week. The four-week moving average for continuing claims was 3,192,250, down 9,750 from the previous week.

This data will have no effect on the Employment Situation report to be released Friday by the Bureau of Labor Statistics (BLS). That report is based on data collected for the week of the month including the 12th calendar day. Economists surveyed by Bloomberg expect that report to show 185,000 new payroll jobs in January and that the unemployment rate dropped to 7.7 percent from 7.8 percent in December.

The total number of people claiming benefits in all programs for the week ending January 12 was 5,914,983, an increase of 255,501 from the previous week. There were 7,655,224 persons claiming benefits in all programs in the comparable week in 2012.

According to the BLS, 12,248,000 persons were officially considered unemployed in December, which means that of those individuals counted as unemployed, 6.33 million were not receiving any form of government unemployment insurance, down from 6.59 million one week earlier.

The Labor Department said states reported 2,112,559 persons claiming EUC (Emergency Unemployment Compensation) benefits for the week ending January 12, an increase of 418,762 from the prior week. There were 3,007,696 persons claiming EUC in the comparable week in 2012.

States continue to borrow from the federal government to cover shortfalls in those funds which will eventually have to be repaid--unless Congress intervenes--with higher assessments on employers. Since those assessments are a percentage of payrolls, they discourage employers from adding new workers. As of January 29, 23 states had borrowed a total of $28.6 billion. One week earlier, 22 states had an aggregate $28.3 billion in outstanding loans to cover shortfalls. California accounted for 37.4 percent of the borrowing.

According to the Labor Department detail, also reported on a one-week lag the largest increases in initial claims for the week ending January 19 were in Florida (+1,157), Arizona (+295), and Vermont (+77), while the largest decreases were in Pennsylvania (-12,625), Texas (-10,448), North Carolina (-9,287), New York (-7,379), and Indiana (-6,069).

_Hear Mark Lieberman Friday on P.O.T.U.S. radio, Sirius-XM 124, at 8:45 a.m. and again at 11:45 a.m. Eastern time._