Initial unemployment claims had been steadily improving for much of the fall, but the new figures from the Department of Labor reflect a shock to the system caused by Hurricane Sandy.
The damage caused by Hurricane Sandy sent U.S. jobless claims soaring by 78,000 in the week ended Nov. 10 to an 18-month high of 439,000, according to the latest government figures. A Labor Department official on Thursday said claims surged in the eastern parts of the country that laid in the path of the storm. The destruction of job sites, closure of government offices and widespread power outages caused more people to file claims after an initial delay. Economists surveyed by MarketWatch had expected claims to climb to 380,000 on a seasonally adjusted basis.
The 439,000 claims represent the worst week since April 2011, but again, it’s largely the result of a natural disaster, not an economic crisis.
To reiterate the point I make every Thursday morning, it’s worth remembering that week-to-week results can vary widely, and it’s best not to read too much significance into any one report.
In terms of metrics, when jobless claims fall below the 400,000 threshold, it’s considered evidence of an improving jobs landscape, and when the number drops below 370,000, it suggests jobs are being created rather quickly. We’ve been below the 370,000 threshold four of the last seven weeks, and nine of the last 16 weeks. And with that, here’s the chart showing weekly, initial unemployment claims going back to the beginning of 2007. (Remember, unlike the monthly jobs chart, a lower number is good news.) For context, I’ve added an arrow to show the point at which President Obama’s Recovery Act began spending money.
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