This week’s Unemployment Insurance Weekly Claims Report is one of those reports that should have more explanation behind the statistics. There’s one bit of bad news sandwiched between to bits of good news. Starting with the good news, initial claims dropped to 530K, which was the low of the Bloomberg consensus range (530K to 555K). Last week’s number was revised up 6,000 to 551K. From the report:

In the week ending Sept. 19, the advance figure for seasonally adjusted initial claims was 530,000, a decrease of 21,000 from the previous week’s revised figure of 551,000. The 4-week moving average was 553,500, a decrease of 11,000 from the previous week’s revised average of 564,500.

The advance seasonally adjusted insured unemployment rate was 4.6 percent for the week ending Sept. 12, a decrease of 0.1 percentage point from the prior week’s unrevised rate of 4.7 percent.

The advance number for seasonally adjusted insured unemployment during the week ending Sept. 12 was 6,138,000, a decrease of 123,000 from the preceding week’s revised level of 6,261,000. The 4-week moving average was 6,187,250, a decrease of 1,250 from the preceding week’s revised average of 6,188,500.

The seasonally adjusted numbers are the first bit of good news. The trend is still heading down for initial claims. As usual, those that are interested in data trends should look at the above numbers, but those interested in the actual number of new jobless should take a look at the unadjusted numbers. This week, the unadjusted numbers look significantly worse than the adjusted numbers:

The advance number of actual initial claims under state programs, unadjusted, totaled 434,358 in the week ending Sept. 19, an increase of 21,966 from the previous week. There were 398,070 initial claims in the comparable week in 2008.

The advance unadjusted insured unemployment rate was 3.9 percent during the week ending Sept. 12, a decrease of 0.1 percentage point from the prior week. The advance unadjusted number for persons claiming UI benefits in state programs totaled 5,204,972, a decrease of 91,789 from the preceding week. A year earlier, the rate was 2.3 percent and the volume was 3,014,874.

This is the bit of bad news. Let’s look at a hypothetical scenario that will be extremely important in the next few months: imagine that the Christmas hiring season is exceptionally bad. Would you still use the same seasonal adjustment as last year? It’s at least reasonable to say that you shouldn’t, but good luck thinking of something better. This is another reason that following both statistics is useful. Summer hiring follows a seasonal trend, though it doesn’t quite have the single date of destruction that the Christmas season has, especially because Labor Day came early this year. Fall hiring also has a seasonal component, but the mix of jobs is different than for summer. We simply don’t have enough information to know how bad the bad news is. We were given one extra bit of information today. The DoL bragged about the success of a summer jobs program targeting our youth. This information isn’t particularly useful to us, though. We don’t know how many of those 226,000 jobs would have been created anyway, and few of those jobs will show up in the unemployment data once they disappear. Youth go back to school. This all works together to make analyzing these statistics frustratingly difficult.

As for the good / bad lists, they’re the other bit of good news.

The good list (-1000 or more): TX, IL, PA, MI, MA, FL, KY, SC, CA, GA, NC, IA, NY, IN, OH, CT, TN, WA, MO, AZ, LA

The bad list (+1000 or more): WI

WI (the worst) was +1,573 vs TX (the best) at -4,623. Trade, service, manufacturing, and construction all made it to the good list multiple times. Wisconsin blamed the construction, service, and manufacturing industries, but the sheer size of the good list overwhelms the Wisconsin data point. The good / bad lists lag by a week, so this good news really highlights how good last week’s numbers were. The lists are also evidence that Labor Day clearly wasn’t an abrupt end to the summer season.

In the final analysis, this is a mixed report. The seasonally adjusted numbers indicate that the unemployment situation is still stabilizing, but the unadjusted numbers tell of more problems for the state unemployment funds. In the absence of additional information, we can’t read too much into either statistic. As a closing bit of good news for the unemployed, I’ve seen more mentions of the unemployment benefits extension bill. That should be working its way through the system.

-By crazynutjob.

Read all of crazynutjob’s unemployment report recaps here.