Jobless Claims Jump, Computer Errors And Government Shutdown To Blame

Jobless claims rose to a six-month high in the past week with an increase of 66,000 applications. This takes claims to the seasonally adjusted 370,000. Is this a sign of a faltering job market? Much of it is actually the result of a computer glitch in California’s systems that created a backlog of claims. Some of the new unemployment applications also come from contractors laid off in the wake of the government shutdown.

As NBC News reports, the US Labor Department says this is the highest number of unemployment claims seen since late March. They say California’s transition to an upgraded computer system lead to unintended technical problems.

At least 15,000 of the 66,000 jobless claims come from contractors affected by the current government shutdown, now in its second week. Federal workers are also able to apply for unemployment, however those numbers won’t come out until next week. According to NBC News, claims numbers are the only reports being put out during the government closure.

This recent spike is not cause for alarm, glitch or not. Before the sudden rise, the Labor Department says unemployment claims fell to the lowest rates in more than six years, reports USA Today. However if the US Congress is unable to come to an agreement that ends the continuing shutdown, there could very well be more government contractors forced to lay staff off. Federal employees requesting unemployment will also likely grow as the shutdown stretches on. Economic advisers for the White House are watching these numbers as an indication of how employers are responding to the standoff in Washington.

Polled economists say they were expecting unemployment applications to rise to 325,000 last week. Adjusting for California’s computer glitches, this number was an otherwise accurate prediction. Though jobless claims spiked in the past week, application numbers are expected to return to lower levels in the coming weeks.

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