Initial state unemployment benefit claims slip 31,000 to seasonally adjusted 292,000
WASHINGTON (Reuters) — The number of new U.S. jobless claims fell sharply last week but much of the decline appeared due to technical problems in claims processing, clouding the last major reading of labor market health before the Federal Reserve meets to consider reducing its stimulus for the economy.
Initial claims for state unemployment benefits slipped 31,000 to a seasonally adjusted 292,000, the U.S. Labor Department said on Sept. 11. That was the lowest level of claims since 2006, confounding analysts' expectations for a mild increase. But a department analyst said the majority of the decline appeared to be because two states were upgrading their computer systems and did not process all the claims they received during the week.
This is highly unusual, and the analyst declined to say which two states reported the problems. He said one of them was a large state and the other small. It was likely that the unprocessed claims would appear in the following week's data, he said. All states submitted data for the week. Also potentially clouding last week's claims data, most offices and work sites in the country were closed for a holiday on Monday of last week.
Yields on long term U.S. government debt rose following the data's release, while the dollar cut losses against the yen and rose against the euro.
While the drop in claims should be taken with a grain of salt, it doesn't change the view that employers appear to have ended a long cycle of elevated layoffs that began around the 2007-09 recession.
"The decline might be partially determined by one-off factors," Annalisa Piazza, analyst at Newedge Strategy, said in a note. "That said, today's data certainly confirm that the U.S. labour market seems to be on a slow healing process."
The four-week moving average for new claims, which smooths out volatility, had in prior weeks already fallen to its lowest levels since 2007. Last week, it fell by 7,500 to 321,250.
