The latest US Department of Labor report showed that for the week ending October 18, the number of initial unemployment benefit claims rose to 232,000. This is still far from the levels seen during major crises, but such an increase suggests that the labor market is starting to cool down a bit.
Analysts are closely monitoring the latest data and trying to determine whether the previous labor shortage is gradually disappearing.
The picture became clearer after the publication of statistics on continuing claims. The number of people continuing to receive benefits reached 1.957 million. A week earlier, the figure was 1.947 million, so the increase is small, but it is there.
At the same time, sources noted that the agency was unable to publish data on initial claims for the past three weeks. They explained that the weekly report is temporarily unavailable due to the effects of the government shutdown that began at the start of the month.
There is also good news. Despite the restrictions, the department still managed to share some statistics through other online sources. And raw data on claims in individual states is still available for download.
The federal government shutdown hinders the release of the weekly unemployment claims report
Economists were greatly helped by the reports published by the states themselves. It was from these that they pieced together the picture for new claims, since federal statistics never came out. The approach was simple: take the latest state data, apply the old seasonal adjustment coefficients, and use this mix to calculate the weekly claims figures.
The shutdown only made things more complicated. Because of it, several macro reports were delayed at once, including the main labor market report. Therefore, investors and analysts had to switch to any available sources: private, alternative, anything to understand what is happening in the economy.
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Meanwhile, the Bureau of Labor Statistics still released the CPI for September. These data were published last month and were needed to calculate the annual adjustment of social benefits. The Social Security Administration traditionally relies on the September index, so it had to be published despite the government shutdown.
As for the September employment report, it was supposed to be released on October 3. The timeline shifted, and now the publication is expected closer to the end of the week.
The Fed expresses concern about the labor market despite the delay of the BLS report
Speaking about the Bureau of Labor Statistics’ decision to publish the September Consumer Price Index, sources clarified that the data was released in Washington on October 24 at 8:30 a.m. The original publication was scheduled for October 15, as stated in the agency’s announcement.
At that time, BLS noted that no other reports would be postponed or prepared until the government returns to normal operations.
To show how determined the agency was to release important data, one reliable source said that some employees were called back to prepare the report by the end of October.
The source added that the government used CPI data for the third quarter to calculate the cost-of-living adjustment for next year for social benefit recipients. Usually, the COLA announcement comes right after BLS publishes the September CPI.
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According to a department representative, the Social Security Administration did announce the new COLA on October 24. This schedule allowed the Fed to get the necessary data before the meeting on October 28 and 29.
Against this backdrop, investors decided that the regulator might have the opportunity to lower interest rates again. However, some representatives of the Fed were cautious about this, as inflation remains above the target level.
Fed Governor Christopher Waller said in an interview that having the CPI report by this meeting would have been very useful. But he is more concerned about the labor market situation and is waiting for the BLS to finally publish the September employment report.
