WASHINGTON — Initial claims for U.S. state unemployment benefits surged by 62,000 to 298,000 in the September 2 week, well above the 248,000 level expected and the highest level since the April 18, 2015 week, data released by the Labor Department Thursday showed.
The level of claims clearly indicates the beginning of a spike in Texas claims filings resulting from Hurricane Harvey, with further gains likely to come next week and thereafter. The addition of Hurricane Irma, which is expected to slam into Florida over the weekend, will add more to that total in a few weeks.
Unadjusted claims rose by 51,637 in Texas in the September 2 week, while claims in Louisiana, which was also impact, rose by 258. Both of these states were able to report actual claims data rather than having to estimate it.
The four-week moving average for initial claims, a better measure of the underlying trend of the data, rose by 13,500 to 250,250 in the September 2 week, breaking a string of declines. The four-week average will continue this upward trend as the headline number rises. Even if the number of headline claims does not change next week, a very unlikely scenario, and there are no revisions to data from the past four weeks, the four-week average will rise by 16,500 as the 232,000 level in the August 12 week rolls out of the calculation.
Seasonal adjustment factors had expected an increase of 1.3%, or 2,601, in unadjusted claims in the week. Instead, unadjusted claims surged by 53,999 to 250,226. The current week's level was well ahead of the 217,715 level in the comparable week a year ago, though the hurricane accounts for the deterioration.
The level of continuing claims fell by 5,000 to 1.940 million in the August 26 week, while the four-week moving average for continuing claims fell by 4,000 to 1.948 million. The impact of Hurricane Harvey and later Hurricane Irma should start to be seen in the level of continuing claims in the coming weeks.
The seasonally adjusted insured unemployment rate held steady at 1.4% in the August 26 week for the 21st straight week. The current week's rate is down from 1.6% in the same week a year earlier.
The unemployment rate among the insured labor force is well below that reported monthly by the Labor Department because claims are approved for the most part only for job losers, not the job leavers and labor force reentrants included in the monthly report.
