New jobless claims rose sharply last week, surging 51,000 to 454,000 on a seasonally adjusted basis, the Labor Department reports. New filings for unemployment benefits are now at the highest since last October. Is it time to rethink the economic revival that appeared to be chugging along anew in recent months?
The four-week moving average of new claims is drifting higher now too, suggesting that there’s more than weekly volatility at work here. It may all prove to be temporary, of course. This series is known for whipsawing the audience. Nonetheless, it’s getting harder to ignore the lack of continued progress in jobless claims.
But maybe there’s less risk than it appears. Reuters reports that the jump in new claims was partly due to snow. “I’ll buy that it can be blamed on the weather,” says Peter Tuz of Chase Investment Counsel. “But it does show that the recovery is growing in fits and starts.”
Meanwhile, Dow Jones advises:
A Labor Department analyst said seasonal factors, particularly bad weather, likely distorted the latest numbers. Alabama, Georgia, North Carolina and South Carolina all reported a higher than expected increase in claims because of snow, he said.
“I’m fairly certain the data was distorted,” the analyst said. Snow can lead to higher jobless claims because schools are closed, delivery trucks can’t run and construction stalls.
If nothing else, there’s one more reason to cheer on the arrival of spring. Unfortunately, it’s still January.