Unemployment Benefits Tumble Again (And California Reports More Distortions)

The 16-day partial government shutdown is over, which means we can focus exclusively on our favorite weekly economy report:

Applications for jobless benefits decreased by 12,000 for the week ending Oct. 19, bringing the total to 350,000, down from last week’s revised figure of 362,000, the Labor Department announced Thursday.

California data was once again distorted due to computer-related systems upgrade, a Labor Department spokesman said.

"Weekly applications spiked three weeks ago as California began working through those claims and the shutdown caused temporary layoffs by government contractors. Applications have declined for two weeks since then," the Associated Press report.

This is the third week that the Golden State has distorted the Labor Department’s unemployment benefits report.

The four-week moving average, a “less volatile” figure, increased by 10,750, bringing the total to 348,250, up from the previous unrevised average of 337,500.

“The advance seasonally adjusted insured unemployment rate was 2.2 percent for the week ending October 12, unchanged from the prior week's unrevised rate,” the report reads.

“The advance number for seasonally adjusted insured unemployment during the week ending October 12 was 2,874,000, a decrease of 8,000 from the preceding week's revised level of 2,882,000. The 4-week moving average was 2,894,750, an increase of 13,250 from the preceding week's revised average of 2,881,500,” it adds.

The states with the largest increases in initial claims for the week ending Oct. 12 were California (+11,781), Pennsylvania (+3,362), New York (+2,443), Illinois (+2,178), and South Carolina (+1,182).

Meanwhile, Kentucky (-2,178), Ohio (-2,164), Minnesota (-1,375), Massachusetts (-1,059), and Hawaii (-705) posted the biggest decreases in initial claims.

Markets have reacted to the news with the usual nonchalance: