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Friday, November 16, 2012

The Truth About That Big Jump in Weekly Unemployment Claims

The Truth About that Big Jump in Weekly Initial Claims for Unemployment Insurance: 

Yep, it is a big jump indeed, the biggest jump in months.  The number of people filing for first time claims last week, the week ending November 10th, was 439,000 a jump of 78,000 over the number of first time claims filed for the week ending November 3rd.  361,000 claims were filed during that week.  (See the graph below.)

The controversy is whether or not the increase in claims for the week ending November 10th is due to the effect of Hurricane Sandy.. or, as some in the right wing blogosphere believe, due to the re-election of President Obama.  More discussion about this below.

Meanwhile, the percent of unemployed people who are getting unemployment benefits continues to fall, as it has over the past year.  The percent of unemployed people who are getting any level of benefits as of the week ending October 27th, 2012, is 40.6%.  (12,258,000 unemployed people and 4,977,808 people receiving any kind of unemployment benefits.)  The percent of unemployed people who were getting unemployment benefits as of the same week a year ago, the week ending October 29th, 2011, was 49.2%.  (13,759,000 people were unemployed and 6,773,326 of them received benefits.)

The righties are having a field day with the increase in claims.

This thread at the Huffington Post is full of inaccurate statements and even a few racist comments.  So let's look at the facts-- and the rumors-- being touted by our friends on the right.

Is the jump in claims due to Hurricane Sandy?

We won't know for sure until next week when the state numbers for the week ending November 10th are released.. because we don't yet know where the layoffs for the week of November 10th occurred!  State weekly numbers are a week BEHIND the national weekly numbers.  However, it's very likely that most of the huge increase in initial claims is due to Hurricane Sandy.  There were big increases in initial claims in three states for the week ending November 3rd, and those states were three of the many states that were impacted by Sandy:  Ohio, Pennsylvania, and New Jersey.

Now most initial claims due to Sandy were NOT filed in the week ending November 3rd, which is why nationwide initial claims went DOWN during that week.  But they hit the week ending November 10th with gusto, which is what most people who look at these numbers expected.   
Updated November 21, 2012:  The increase in unemployment claims for the week ending November 10th does appear to be related to unemployment claims following Hurricane Sandy.  In the weekly unemployment claims report released just today, a weekly report that includes state detail from the week ending November 10th, there was an increase of 43,956 claims from New York and an increase of 31,084 claims from New Jersey.  Pennsylvania also showed an increase of claims of 7,037 and Connecticut, another state hit by Sandy, showed an increase of claims of 1,808.  Claims from these four states total over 83,800, which is more than the 78,000 increase in claims reported last week.
A few facts and a few falsehoods pertaining to this week's report: 

Initial claims have been going down and are still as a whole lower this fall than they were last fall:

"But claims are up in Pennsylvania and Ohio this week and they weren't impacted by the storm--  Someone is lying!"

Sigh.  If it's not Benghazi, it's something else.  

The state numbers follow the national numbers by one week.  In other words, we had a huge increase in unemployment claims in the week ending November 10th.  But the state numbers that were reported, the state numbers that showed a decrease in claims for New York (which was hard hit by Sandy) and an increase in claims for Pennsylvania and Ohio, were for the week ending November 3rd.  

Few claims resulting from Sandy were filed in the week ending November 3rd; most of these claims were filed in the week ending November 10th.  As I wrote above, we won't know how many initial claims were filed from the hurricane states until next week.   

Unemployment Claims Following Hurricane Katrina:

For the record, there was an increase of 100,000 in initial unemployment claims in the week following Katrina.  The number of initial claims was elevated for over 6 weeks in the fall of 2005, but then came back down to its pre-Katrina numbers.  Sandy was a very large storm affecting a very populated area.  We can expect high claims numbers for several more weeks.


"Right before the election there was a big decrease in initial claims.  Now it has gone up, so something is fishy."


There was a big drop the first week of October, but that was due to irregularities in reporting from at least one state.  The number of claims went up the second week of October, but the low claims and the high claims evened out over those two weeks to just about the same average.

"Obama has been reelected; and we are now plunging into recession.  You'll be sorry!"

Oh, please... You lost.  Go away.  The market has been down since Obama was re-elected due to "fiscal cliff" issues regarding tax cuts and automatic spending cuts that will kick in on January 1st if nothing is done about them.  That creates uncertainty and markets do not like uncertainty.

And, as I have said and as every pundit out there has said, this week's huge jump in initial claims for unemployment benefits is most likely due to Hurricane Sandy.  We will see which states contributed to the increase NEXT week.  We don't have that state information THIS week.  


  1. I took a look at the Huffington link you provided and while it blamed the rise of applications on Sandy, which is what you are also saying, I saw no racist comments in the article.

    1. I believe that there were a few racist comments TO the article vs. within the article itself. Fortunately or unfortunately, I did not quote those comments.

  2. Thank you for the reasonable explanations. However, I seriously doubt rightwingers will be accepting of your viewpoint. Keep the good information coming.


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