Americans are filing for unemployment benefits and Hurricane Harvey just lifted the U.S jobless claims to its highest level in two years. The hurricane only served to boost an underlying trend consistent with a firming jobs market, when a surge of unemployment applications were received in Texas amid the Hurricane Harvey crisis.
Reuters reports that for the week ending September 2, initial unemployment benefit claims increased by 62,000 to a seasonally adjusted 298,000. This increase is the largest for a week since November 2012. Overall, this is the highest level in the U.S. since April 2015, the Labor Department confirmed on Thursday, September 7. The Labor Department also clarified that the data for the previous week was impacted by the natural disaster which devastated Texas, Hurricane Harvey and the flooding in Houston.
Texas was not the only state affected by the storm as claims for Louisiana also increased. The unadjusted claims rose by 51,637 in Texas for the week of September 7, as people found themselves temporarily unemployed. Likewise, people in Louisiana also filed unemployment claims and this number increased by 258. Due to Labor Day holidays, claims for California, Hawaii, Kansas, Puerto Rico, Virginia, and Wyoming could only be estimated and there is not a precise total available for these states.
The U.S. government stated last week 156,000 jobs were created in August. Over the last few years, there seems to be a trend of an initial weak August job count, where after revisions show strength in the market. Economists agree that the slowdown in job growth is merely a seasonal quirk. In fact, Reuters polled economists and they had forecast that unemployment claims would rise to 241,000 for the given week. However, it has even exceeded their predictions by more than 50,000.
In general, claims over a four week period are considered a better indicator of labor market trends as it averages out week-to-week volatility. The general trend indicates that the labor market is still strengthening. The claim report for the week ending August 26, supports this notion in that after the initial week of aid, the claims for benefits fell by 5,000 to 1.94 million. Americans who have continued claims have consistently been below two million for 21 consecutive weeks, which underscores the current labor market strength.
[Featured Image by Jason Dearen/AP Images]