Last week's excitement about plummeting unemployment claims was short-lived, as the Department of Labor report showed the number of U.S. workers applying for benefits rose last week even higher than it fell the week before. According to DOL, 34,000 more people applied for benefits last week, for a total of 386,000, compared with the previous week's revised figure of 352,000. The last report surprised economists by how far the number fell, while this week's surprised them by how far it rose. Reuters reports that the economists it polled "had forecast claims rising to 365,000" in this week's report. Bloomberg's economists had forecast the same number. According to The Associated Press, however, the numbers don't paint an entirely reliable picture:
Economists view the recent numbers with skepticism. They note that the government struggles to adjust the data to reflect temporary summertime layoffs in the auto industry. And this year, many automakers are foregoing the typical shutdowns because stronger sales have kept plants busier. That has made the process even more difficult.
The four-week moving average, considered a more stable number than the weekly figure, is at 375,500 this week, down from a revised 377,000 last, which still has it just above the 375,000 figure that AP likes to point out "typically suggests hiring is strong enough to pull the unemployment rate down."