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Isaac Pushes Up First-Time Unemployment Claims

First-time claims for unemployment jumped 15,000 to 382,000 for the week ended September 8, the ""Labor Department"":http://www.dol.gov/ reported Thursday.

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Several states ""reported increases in initial claims, ""as a result of Tropical Storm Isaac,"" which increased the total by about 9,000. Economists had predicted a smaller increase, to 370,000.

At the same time, the number of filings in the previous week was revised up to 367,000 from the originally reported 365,000.

Continuing claims ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô reported on a one-week lag ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô dropped 49,000 to 3,283,000 from the prior week's 3,332,000, revised from the originally reported 3,322,000.

Coming at the beginning of the month, this week's reports will not affect the Employment Situation report for September to be released at the beginning of October by the Bureau of Labor Statistics.

The report ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô tracking the nation's unemployment rate and job creation ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô is compiled based on payroll and household surveys for the week of the month including the 12th calendar day.

The weather factor makes comparisons with prior reports inconclusive. In the aftermath of Hurricane Katrina in 2005, claims jumped 96,000 with virtually all of the increases attributable to the storm.

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Even without the estimated impact of Isaac in the current report, claims increased 6,000, the largest week-over-week increase since the end of July when claims rose 11,000.

The upward adjustment to the prior week's report was the 32nd time this year the preliminary data was revised higher.

The four-week moving average of first time claims increased 3,250 to 375,000, the highest level in eight weeks, the fourth consecutive weekly increase.

The four-week moving average of continuing claims fell 7,500 to 3,316,500 from 3,324,000.

The total number of people claiming benefits in all programs ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô reported on two week lag - for the week ending August 25 was 5,391,576, down 78,465 from the previous week.

Most of the decline came in two categories: emergency claims which fell 40,543 and regular state benefits which dropped 30,101.

State programs have been shaved due to state budget pressures and the depletion of state unemployment insurance trust funds while Congress imposed new restrictions on emergency claims.

States have been borrowing from the federal government to cover shortfalls in those funds which will eventually have to be repaid ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô unless Congress intervenes ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô with higher assessments on employers.

Since those assessments are a percentage of payrolls, they discourage employers from adding new workers. As of September 6, 20 states have and aggregate $25.6 billion in outstanding loans to cover shortfalls, led by California which has borrowed almost $9.6 billion.

States reported 2,223,071 persons claiming EUC (Emergency Unemployment Compensation) benefits for the week ending August 25, a decrease of 40,543 from the prior week the Labor Department said. There were 3,066,671 persons claiming EUC in the comparable week in 2011.

According to the Labor Department detail, also reported on a one-week lag the largest increases in initial claims for the week ending September 1 were in Pennsylvania (+1,639), Nevada (+1,351), Michigan (+915), Texas (+804), and Iowa (+691), while the largest decreases were in Florida (-1,923), North Carolina (-1,566), Georgia (-1,199), Puerto Rico (-1,101), and New Jersey (-789).

About Author: Mark Lieberman

Mark Lieberman is the former Senior Economist at Fox Business Network. He is now Managing Director and Senior Economist at Economics Analytics Research. He can be heard each Friday on The Morning Briefing on POTUS on Sirius-XM Radio 124.
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