Initial jobless claims rose 15,000 last week to a seasonally adjusted 382,000–the highest since July. But the Labor Department advises “that several states have reported increases in initial claims (approximately 9,000 in total) for the week ending September 8, 2012 , as a result of Tropical Storm Issac.” Does that mean that last week’s rise is temporarily skewed with storm-related noise? Possibly, although only time will tell. Meantime, one reason for thinking positively: the unadjusted claims data on a year-over-year basis is still falling by 10% as of last week, a rate that’s in line with recent history. That’s a sign that it’s premature to read too much into last week’s seasonally adjusted jump.

Putting the potential for statistical mischief via Ivan aside for a moment, let’s review how the seasonally adjusted history stacks up with last week’s data point:

Even if the latest pop reflects deeper trouble in the labor market beyond Issac’s nefarious influence, the worst you can say of the seasonally adjusted weekly numbers of late is that they’re treading water. That’s hardly productive at a time of sluggish growth overall, but it’s still well short of a smoking gun for arguing that the labor market’s growth phase is dead. Even if you think otherwise, we should still be suspicious of the last several data points for this volatile series. The tendency for being mislead is high with weekly claims when we focus on the last several weeks.
A clearer picture of the true trend for initial claims can be found in the annual percentage changes of the raw numbers—before seasonal adjustment. By that benchmark, not much has changed with today’s update, which is a good thing. As the next chart reminds, new claims continued to fall last week by roughly 10% a year. That’s generally in line with the track record over the past 12 months, and overall it’s a healthy trend—if it continues.

When the tide truly turns to darkness for the business cycle, as it one day will, history implies that it’s likely that we’ll see a warning sign relatively early via increases in the year-over-year percentage change in claims data, in both the seasonally adjusted and unadjusted numbers. For now, however, claims continue to retreat each week relative to a year ago. That suggests that the labor market’s expansion, modest though it is, hasn’t yet run out of steam.