Labor Department cooks the books

First-time unemployment claims were lower this week than last, but the Labor Department changed how it calculates that data, putting signs of recovery in doubt.

The total number of claims was at 881,000, down from just over 1 million the week before, according to a Department of Labor report.

But that total ignores the 759,000 new claims filed by freelance, contract and other workers who are eligible for assistance under the federal coronavirus relief package.

That makes the total number of claims 1.6 million, an increase over last week.

“I’m really concerned that the pandemic assistance claims are rising,” economist Gregory Daco told the New York Times. “Altogether you’re looking at 1.6 million filing. It’s pretty bad at this stage in the crisis.”

Democratic presidential candidate Joe Biden echoed that concern in a speech Friday from Delaware.

“I’m grateful for everyone that found work again but there is real cause for concern as well,” Biden said. “The pace of the job gains in August was slower than July and slower than in May and June. More and more temporary lay-offs are turning into permanent layoffs, 28 million people filed for unemployment and after six months of the pandemic we’re less than halfway back to where we were.”

Biden focused specifically on manufacturing jobs lost during the pandemic. President Donald Trump often falsely portrays himself as saving those jobs from going overseas. 

“We’re still down 720,000 manufacturing jobs, in fact Donald Trump might be the only president in modern history to leave office with fewer jobs than when he took office,” Biden said. 

The change in how the Labor Department calculates unemployment claims is due to the “seasonal adjustment” process, which aims to stop predictable patterns of people losing work, like temporary holiday jobs going away in January, from making it seem like the economy is deteriorating.

But an unprecedented number of Americans have filed for unemployment during the coronavirus pandemic, throwing the “seasonal adjustment” process out of whack.

In order to course correct, the Department of Labor said it needed to change how it tallied unemployment claims to get a more accurate picture of joblessness in the country. 

But the new approach depresses the overall number of unemployment claims and makes comparing new data, like this week’s filings, against past reports meaningless.

Media outlets including The New York Times and USA Today have said they will use the unadjusted numbers until the Labor Department adjusts previous figures.

There’s a sure-fire indicator of the US jobless landscape, consultant Joseph Brusuelas told Marketplace: the number of people receiving an unemployment check each week, which totaled around 29 million as of late August. Biden pointed to the jobs report as another example of Trump’s failed leadership.

“When the crisis started we all hoped that a few months of a shutdown would be followed by a rapid economic turnaround. No one thought they’d lose their job for good or see small businesses shut down en masse. That kind of recovery requires leadership, leadership we didn’t have and still don’t have,” Biden said.


Connect with NJTODAY.NET


Join NJTODAY.NET's free Email List to receive occasional updates delivered right to your email address!
Email ads@njtoday.net for advertising information Send stuff to NJTODAY.NET Like Us On Facebook Follow Us On Twitter Download this week's issue of NJTODAY.NET
Print Friendly, PDF & Email