Sorting through the Data Chaos in Unemployment Claims: Week 31 of U.S. Labor Market Collapse

California Emerged from its “Reset.”

By Wolf Richter for WOLF STREET.

California’s Employment Development Department – whacked by reports of chaos and massive backlogs in processing and paying unemployment claims, and by waves of fraudulent claims, particularly under the federal Pandemic Unemployment Assistance (PUA) for the self-employed – announced on September 19 that it had “paused” processing claims for a “reset” period during which it would fix the issues and catch up with its backlog.

This pause halted California’s reporting of unemployment claims to the Department of Labor; and in the following weeks, the DOL then just copied and pasted California’s last reported data into its weekly unemployment claims report. California accounts for about a quarter of US unemployment claims.

At the time, the DOL, in explaining its decision of copying-and-pasting old data every week until California catches up, also said: “Upon completion of the pause and the post-pause processing, the state will submit revised reports to reflect claims in the week during which they were filed.” And those “revised reports” showed up today, and the prior data has been revised. A glorious feast of data chaos.

California’s initial unemployment claims fell by 17k from the prior week to 158.9k people who’d newly filed for UI under the regular state program in the week ended October 17.

California’s continued claims fell by 145k to 1.87 million. Since the day the “reset” began four weeks ago, and adjusted with the new insights gained during the “reset,” continued claims have dropped by one-third (from 2.8 million). The huge spike in early May was more California data chaos:

Newly-laid off workers: state UI initial claims remain high.

Across the US, initial claims for UI under state programs fell by 73k to 757k (not seasonally adjusted) in the week ended October 17, not quite undoing the jump last week of 98k, and remaining higher than week before last week. The number of initial claims has been in the same range for the 11th week in row:

Initial state claims and initial PUA claims. Initial PUA claims ticked up a smidgen in the week ended October 17, to 345k. When added to the initial state UI claims of 757k, the combined total amounted to 1.1 million in the week ended October 17. Meaning 1.1 million people who’d lost their work filed for UI in one week, and this number hasn’t changed much over the past eight weeks, and it’s still a huge number.

Continued claims, state and federal.

Total continued claims for unemployment insurance (UI) under all state and federal programs fell by 1.05 million, to 23.15 million people (not seasonally adjusted), the lowest since early May, according to the Department of Labor this morning. These 23.15 million continued claims of UI – marred by data chaos of backlogs, over-reporting, under-reporting, and fraud allegations surrounding the PUA claims – would constitute 14.4% of the civilian labor force of 160.8 million.

These total continued UI claims under all programs are reflected in the chart below: The huge jump in total UI claims in late August and early September, that then suddenly unwound, was caused by a huge jump in California’s continued PUA claims (part of the red columns) that California then unwound two week later by an even huger drop. It has been data chaos all along:

Blue columns: Continued Claims under state programs.

The number of people who continued claiming UI under state programs fell by 1.02 million to 8.0 million, the lowest since late March.

Red columns: Continued Claims, federal & other key programs.

The number of people who have claimed UI since at least Oct. 3, under all federal programs established by the CARES Act and some other programs ticked down by 28k to 15.2 million (not seasonally adjusted):

  • Federal PUA claims dropped by 426k to 10.2 million.
  • Federal PEUC jumped by 510k to 3.3 million, having nearly tripled in five weeks. The Pandemic Emergency Unemployment Compensation program, established under the CARES Act, covers workers not covered by other programs.
  • State Extended Benefits jumped by 90k to 445k, having doubled in five weeks.
  • State STC / Workshare ticked down by 1k to 195253k.

Federal PUA & PEUC continued claims combined.

These are the two programs established under the CARES Act: PUA to provide UI to gig workers for the first time in history, and PEUC to cover workers who are not eligible under other programs, or lost coverage under other programs. The combined total reported today rose to 13.5 million, the highest in three weeks. Beyond the California PUA surge-and-plunge in late August and early September, has essentially been flat for the past five weeks, as continued PUA claims (black columns) have declined, but continued PEUC claims have risen:

And Florida provides more data chaos.

Florida finally figured out how to process and report initial PUA claims on a weekly basis a few weeks ago. And those claims have been surging. Today Florida reported 49,641 initial PUA claims, the most of any state, and nearly double California’s initial PUA claims (25,168). But Florida is still not reporting “continued PUA claims,” the only state failing to do so. Their absence likely understates total US continued PUA claims and adds to the data chaos.

The picture that emerges.

The UI claims data indicates that the labor market is churning wildly through people, with over a million people on UI getting hired every week, while over a million people are still losing their work every week and filing for UI. But slightly more people on UI are finding work again than people are losing their work and filing for UI. This massive churn shows the extent of the turmoil in the economy as companies try to deal with all the shifts and changes, where some companies hire hand-over-fist while other companies are shedding workers.

 

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  59 comments for “Sorting through the Data Chaos in Unemployment Claims: Week 31 of U.S. Labor Market Collapse

  1. AbstractSyntax says:

    How is it state claims are 1/3 of their peak while all other total claims remain basically flat? If state unemployment recipients were falling off and converting to PEUC, the red bar should rise in response. It’d be nice to see some more granularity in the data– something seems off.

      • Mira says:

        But, but, but … & therefore.
        Have we the people of planet earth been suckered into believing that technology is such .. so advanced & insurmountable that it can do all things .. that it has become God’s right hand in things ??
        & therefore what else did they spend all the money on ??

        • Mira says:

          We are in anticipation of being implanted & plugged into the internet as an appliance would be plugged into a power point ..
          Who told me? .. Elon Musk.
          Come on .. it has to be true.
          But the technology cannot juggle a few million figures.

        • Turtle says:

          I know, huh? I read how AI is going to take over… 20 minutes later and Siri can’t even find the closest Which Wich.

        • Petunia says:

          Some of the tech problems I am seeing routinely in the media are so bad it is beyond incompetence, it’s seems almost by design. I would particularly single out California’s unemployment debacle and that trading app with a descriptive name. These systems are like minefields, but if you know where the mines are they can be goldmines.

        • All technologies create their own morality. If you think the internet is about the free exchange of ideas you don’t get it. It is almost as though populist, conspiracy based movements are self defeating. You raise the issue, what about freedom and decency? Everyone knows what you are talking about. If not now, then soon, AI developers will be able to provide a policy reaction to every major event in the last four years, and on that record run their program for office. The morality of programming morality, then, is how does advancing the needs of the disenfranchised just enough to maintain social stability serve (their) long term interests? 100 years after their revolution would Bolshevicks be in exactly the same position they are in now? If they had AI could they have avoided the pain and suffering? If AI can tell you the effects of a new technology, like the automobile, they could predict what the world will look like, and you can decide do we want to go there? Can one technology correct the flaws of the previous technology, and the answer is probably yes, and what is the morality of that? For any new morality to succeed we have to weed out the counterproductive thoughts and actions, just as we doing right now. The real purpose of this mass hysteria, flat earth nonsense, is to purge those thoughts from our collective consciousness, and end history.

    • wiley says:

      All of it is suspect!Also,many people have moved out of California,Washington,Oregon due to fires.I would also assume many have moved out of Louisiana and Texas to evade hurricanes.They would then apply for different unemployment or look for jobs?I trust 0 of the government data,especially related to covd.Inconsistent,outofdate,nonsensical,partial,totally fabricated,take your pick.

      • VintageVNvet says:

        Thanks wiley, you summarize it better than I have seen so far!
        As a ”pre boomer” AKA war baby or silent gen,, but trained at what was the best public college/uni in USA at the time in science, I am SO sad to see what certainly appears to be at least insufficient, if not outright corrupt data continuing at almost every possible data collection point and publication.
        IMO, Johns Hopkins does what it can on it’s global reporting site;;; how some ever, the data there too is obviously either challenged by lack of precision of data suppliers, or, more likely, actually manipulated intentionally for one reason or another by all those data suppliers around the world.
        While We the Peedons can and should hope that sooner rather than later the very clear differences in data acquisition, as well as the very obvious manipulation of that data will cease, and former examples will be corrected to be more accurate,,,
        IMO based on many such events formerly, it will take a long time, perhaps decades, until the truth of this virus event comes to be generally accepted.
        We can only hope that at that point in time the truth of this virus event is publicized widely so that ”ALL” rational folks can proceed appropriately next time, a next time that is inevitable.

  2. Cashboy says:

    What one will probably find is that people that were made unemployed and found new employment were probably re-employed on a lot less wage (possibly minimum) and had fewer paid hours.

  3. Cobalt Programmer says:

    (read in ZH)

    Rapped named “Nuke Bizzle Ft. Fat Wizza” released a rap video about how he scammed Cali EDD for an estimated sum of $1.2 Million. Fed saw the video on you tube and arrested him in LV with several EBT cards. There are more of them for sure. How many companies were arrested for using relief money toward bonuses? Justice is blind indeed.

    • Petunia says:

      If you illegally sell or use narcotics on a small scale you go to jail for a very long time. If you deliberately distribute and addict millions of people, you pay a fine equal to a very small percentage of your profits. America, what a county!

      • Khowdung Flunghi says:

        “If you deliberately distribute and addict millions of people, you pay a fine equal to a very small percentage of your profits.”

        Roger that! As Hillary said when asked why drugs were illegal, her response was “there’s too much money in it.” Nothing, NOTHING, will ever change until we stop trying to control every aspect of everyone’s life.

      • Frederick says:

        George Carlin explained this pretty well with his Big Club analogy a long time ago

    • Thomas Roberts says:

      Cobalt Programmer,

      The most important thing is to never admit fault. Look at Bernie Madoff. Even some of the top can go down, if they get too arrogant or suddenly grow a conscience. There is an art to avoiding justice. Those on the bottom can always be squished, the bugs at the bottom have to avoid detection altogether or get lucky.

  4. gorbachev says:

    All seems like so much B.S.

    Number of workers less those that do not have jobs

    seems to work best.So 20% U.I rate.

  5. Mark says:

    Who exactly is panic buying the stock market?

    Where did they get the trillions from to do so?

    • Wolf Richter says:

      Is anyone “panic buying?” The S&P 500 is down 2.3% over the past 8 trading days. Doesn’t look like panic buying or panic anything to me.

      • Patrick says:

        Calm before the storm. A massive rally is loading after the election but it either launches once final results are in or after the Fed has to step in to backstop a big selloff. Something’s going on sale though, and that something is Gold.

      • Old School says:

        I only own one stock. It’s small cap value. It’s been up five days in a row and is about 25% off it’s September lows. Maybe we are finally getting the rotation into value that is long overdue imho.

        • Wolf Richter says:

          Old School,

          I only own one stock, big tech, and it’s down 11% today, and trading close to its March low… Just kidding about me owning the stock, but INTC is down 11% today, and is trading close to its March low. It’s very risky to judge the market by what one stock, even a big stock, is doing.

      • Wolf, the stock market will eventually get the picture but I think it will take a contested Presidential election, another GDP report of 25% down year-to-year, or the Fed standing pat which they know they have to do at some point to avoid further damage to the Dollar. Looks like the shorting opportunity of a lifetime in stocks and bonds.

        P.S. I think every capable Senior in this country should send the Fed a cow patty for robbing them of interest income for the last decade plus!!!

  6. Jon says:

    The UI rate may be 20% but their spending seems not decreasing. The companies ERs are showing people are buying stuffs like there is no tomorrow and home prices are going up and up

    • gorbachev says:

      I hope the increased spending continues but i think

      only govt stimulus will allow it to continue.

      As far as housing goes much of the increase can be attributed to

      the devaluation of the dollar and to the increased cost of

      building or renovating a property

    • Frederick says:

      Home prices are certainly not going up everywhere in the US and not in gold terms

  7. Lee says:

    Garbage in: garbage out.

    Sydney Airport released their traffic performance for September and it makes the US numbers look great:

    “Total passenger traffic in September 2020 was 132,000 passengers, down 96.4% on the prior corresponding period (pcp).

    34,000 international passengers passed through Sydney Airport in September, down 97.5%on the pcp.

    Domestic passengers totalled 98,000 for the month,down 95.7% on the pcp.”

    Sydney Ariport, the company, currently has a market cap of A$16 billion and is trading up 33% off its low in March after raising a couple of billion dollars from flogging shares to institutions and retail shareholders.

    Big bull market here in the travel sector………………………

    • MonkeyBusiness says:

      This is more what I was expecting out of the US numbers. Wolf can say that it’s the most tepid recovery in history for US airlines, and that’s true, but at the same time, you look at the 1 million people still flying here and there and you start to wonder : “who are these people?”.

  8. Beardawg says:

    Only $117 / Week (AZ) for past 2 months now since Fed PUA supplements stopped. However, musicians work for food – so not starving !! :-)

  9. Kasadour says:

    I remember Washington State going through “initial” fraud claims to the tune of >$300 m. That’s mind boggling. Later it was announced that they had recouped some of that and never saw any further reporting on it. What is to be gathered by these reports is that nobody has any true picture of how bad it is, but it’s bad.

  10. Paulo says:

    My takeaway from this article and data was stated often. Turmoil.

    It won’t change until the virus is in real and measurable decline, and then there will be long lasting damage to contend with.

    My final conclusion is sympathy for young families and for young people just starting out. Stepping back from the horrific health effects from the pandemic, the uncertainty and chaos at the beginning of life’s challenges must be a terrible burden. Life’s tough enough at the best of times. But this…..

    A whole bunch of people will be needing help for sure.

    • Yertrippin says:

      Paulo, refreshing comment as usual. Thank you. Empathy is truly needed during these crazy days and seems to be in short supply. As an out of fashion humanist, I’d say it’s the only path to a better future.

    • wiley says:

      Yep,actually,they need help yesterday.People who are fairly healthy,safe,secure Could volunteer or donate food,giftcards,$ to foodbanks,petpantries,LIHEAP,clothingclosets,lowcost legalaid groups.Lots ofneed,pick your passion!

    • Brant Lee says:

      Even before the pandemic, it had become obvious that parents are going to have to set the way for their kids so they can become successful. They can’t just be thrust into the world with a “good luck out there”.

      Saving for college is one thing, but even upon graduation, if fortunately still not buried in debt, it’s a heck of a struggle. It seems every aspect of life is micro-managed by a bank or corporation (housing/ rental cost, insurance, loans, healthcare, transportation, etc) to squeeze every cent possible from working people.

      I have savings for my adopted grandson, but I can only mainly help in the areas I know about. I bought a lot I’m going to give to him. When it’s time, we can start going up with a house if he wants to stay in the area.

      • Kurtismayfield says:

        This sounds exactly like a fuedalist society mindset.. which is where we are heading if things don’t change.

        I plan on leaving my child property.. let her have a fief of her own

        • Brant Lee says:

          What?

          Fief -an estate of land, especially one held on condition of feudal service.

          I set my son up onto his own house and land is feudalist?

        • Lisa_Hooker says:

          I’m leaving mine a hauberk, coif, sword and knife.

      • wiley says:

        You are a great g.pa!Mykids got0 from oneset of g.p.s and nasty unearned comments,then0 after a few years from other g.pa.Theirdad barely talkstothemon phone,does0$!We just defendedourselves in court against my selfish,witchsisyers and were illegally evicted last winter. More,thoughtfil people like you,please!

  11. Lance Manly says:

    For state continued claims it is important to watch the interaction between those and PEUC. Since the vast majority of PEUC are those individuals that have used up their state benefits and PEUC picks up the slack for up to 39 weeks. Unfortunately PEUC data is a week behind state data so you can only see the relationship retroactively.

    Thing will get real serious in January when the 39 weeks is up. With the virus starting to explode, as expected during the fall/winter, I don’t expect hiring to be robust. As an example using March 15, 2020 as a start date gives December 13, 2020 as the week when the benefits expire. Merry Christmas!

  12. Doubting Thomas says:

    Wolf – Another insightful analysis. Thank you. As I am sure you are aware.. In addition to the 23 million unemployed, discouraged workers are starting to drop out of the labor force. A snippet from the Wall Street Journal on 23 October:

    “Work­ers gave up look­ing for jobs across the U.S. in Sep­tember, with the size of the la­bor force shrink­ing in more than half of the 30 states in which un­em­ploy­ment rates fell last month, La­bor De­part­ment data re­leased Tues­day showed.”

    Nothing goes to hell in a straight line. The slow burn begins.

    • Petunia says:

      If you are close to retirement in this crisis, it is likely you may never work again. When these early retirees start to cash out, it is going to be a big sell off of everything.

      • Lance Manly says:

        It will be tough on older tech workers that need to switch jobs. They just aren’t wanted and probably have the money to take it easy, for at least until the business climate improves.

  13. Wolf, what doe does the Labor Participation Rate look like, if you can believe any government numbers now?!!

    • Okay, I will answer my own question, Wolf has enough to do! Go to this link:

      https://www.bls.gov/charts/employment-situation/civilian-labor-force-participation-rate.htm

      Looks like the Chinese approval rating when the Pandemic first hit!!!

      • Doubting Thomas says:

        Thanks, David. The chart in the link you provided nails it. Besides racking up 23 million unemployed in the U.S., the pandemic has caused a 2 percentage point decrease in the labor participation rate, so far. Oh, and today the S&P 500 closed up 46% versus one year ago on 10/23/2019. Somebody please, please explain to me what is going on. Yes, I know, the answer: asset price inflation due to Fed monetary policy. When is this thing going to burst?

        • Thomas, I think the pin is coming on November 3rd or just after since there will be more issues than just Hanging Chads, and I am betting no Stimulus #2 of any size before the Election. Lots of pins floating around out there, very big ones like absence of economic recovery, and this market will not be pretty by year-end.

      • Stevie says:

        Curious indeed how both unemployment and labor force participation rate declined after 2008 GFC. So of course the notion that 2019 represented full employment was farcical.

      • Andro says:

        Nice V-shaped recovery, eh?

    • Frederick says:

      Id imagine almost as pathetic as the Velocity of money m2 chart

  14. Sierra7 says:

    I don’t know how anyone can trust any employment/unemployment numbers anymore.
    And as far as retirees getting a fair shake on less risky CD’s, Certs, etc. what has been done to us is just a social (and judicial) crime.
    Received half dozen CD (credit union) renewals yesterday and sat there and stared at the pathetic returns over the past year. Have many more but the disappointment is just multiplied.
    The poor, disenfranchised, elderly, retired, etc….have been thrown onto a manure pile while the “upper crust” has gotten away with murder.
    I can’t believe the country’s leading politicians believe this will continue without eventual violent protest breaking out all over considering how our economic system is working.
    I have a large family and are constantly in touch with them from my adult children who are gainfully employed and my grandchildren, some who have been relegated to moving back home and struggling to get back into the “action”. Of course most live in the Greater Bay Area which cannot be a reflection of the rest of the country let alone the CA state.
    The pit will appear as another commenter stated, at the end of 2020 when so many support programs will expire.
    Some would characterize the problem as a, “can” to be kicked down the road until it can’t be. I would describe it as a, “landmine” being kicked and soon to explode.
    Our policies have painted “us” into a corner with not escape.
    We refused to pay the piper in past years and now the Covid virus is forcing us to stare into the abyss.
    And, it is deep, deep!
    When you get into bed with animals with fleas you will get them yourselves.
    We (our gov.) mostly have chosen to get into bed with $$$$$ and we will eventually try to get out but laden with those fleas.

    • Sierra7 says:

      Addendum:
      What riles me the most is the huge “avoid taxes at any cost” industry that exists in our country. Led by some of the largest, richest corporations (and their individual investors/owners) whole sectors of the legal system is employed to find ways to bend our tax system laws, hide assets, offshore profits etc, etc. And yet so many would stand and pledge allegiance to our flag in false sincerity and get away with that.
      The US as a whole is being robbed blind of social progress by these “criminals”.
      Our tax base, from the lowliest community to tour largest urban centers are being literally swindled out of their fair share of those monies to improve our country as a whole.
      What kind of “democratic” country do we have (I also realize we are a “republic”) here when so many of the wealthy can get away with these activities while we expand (private) prisons to hurl the common folk into for petty, non-violent crimes?
      Make no mistake. Attempting to hold back huge profits offshore is a “violent” crime against the whole country.
      My we see better days!

      • Tony22 says:

        Why are churches, synogogues, ashrams, temples, which use fire, police, social, streets, utilities etc, exempt from paying property taxers?

  15. tommy runner says:

    ‘I think health care is not a privilege its a right, everyone should have the right to have affordable health care.. this is something that’s going to save peoples lives and this is going to give some people an opportunity, an opportunity to have health care for their children. how many of you home are worried and rolling around in bed tonight wondering what in gods name are you going to do if you get sick because you lost your health insurance your companys gone under. we have to provide health insurance for people at an affordable rate’ (1.07.03).. im happy you and your family had health care when you all needed it, and it was a pleasure for all americans to pay for it for you. just so you know joe, everyone is not rolling in a bed tonight nor are they under a roof. what does the right to affordable health care look like to them. a family rendered unemployed, out of doors and left behind in a food line because of the system you are describing here. shapes of things? vandemic, vnemployment, voodlines or tyranny and mvtation. (ty ybs/boc)

  16. Lisa_Hooker says:

    Yup, everyone has a right to affordable healthcare no matter how much fiat money the government has to create to provide it. Next comes food, shelter, and self-fulfillment at what you love to do. /s

  17. Trailer Trash says:

    We need a new Civilian Conservation Corps but that would be “socialism” so forgetaboutit. It’s much better to have millions living in tents on sidewalks and dumpster diving for food.

    Maybe the homeless will all kill each other and solve the problem. That appears to be the plan right now.

  18. crapstable says:

    The unemployment impacts from the virus are obvious disrupting capacity utilization, thus growth and without a doubt, the labor market:

    https://fred.stlouisfed.org/graph/?g=x3mW

  19. crapstable says:

    Ooops, had to fix that chart real fast, sorry

    https://fred.stlouisfed.org/graph/?g=x3nX

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