For 2nd Week in a Row, Press Says ‘Jobless Claims Fall to 5-Year Low’ as Actual Year-Over-Year Claims Rose

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Tom Blumer @ Newsbusters:

For the second week in a row, actual (i.e., not seasonally adjusted) unemployment claims as reported by the Department of Labor came in greater than the analogous week in 2012.

At the same time, and also for the second week in a row, the department’s seasonally adjusted claims number — the only one the business wire services ever specifically identify in their reports — came in lower. In today’s instance, raw year-over-year claims were almost 5 percent higher than the same week a year ago, but the year-over-year seasonally adjusted figure came in 11 percent lower. That’s bad enough, but then the wires compounded the problem by running with indefensible conclusions based on DOL’s contradictory data.

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The following graphics demonstrate the contradiction. First, here’s last week (issued on January 17 for the week ended January 12):

UnempClaims011213

Both weeks had five buisness days, so it’s hard to understand why DOL used very different seasonal adjustment factors in the two years. If DOL had used the same factor in 2013 as it did in 2012 (1.442 instead of the 1.660 it used), seasonally adjusted claims would have come in at a radically higher 385,000 instead of the reported 335,000 (555,708 divided by 1.442, rounded).

Now here’s today’s related graphic for the week ended Janary 19:

UnempClaims011213

In this case, if DOL had used the same factor in 2013 as it did in 2012 (1.120 instead of the 1.323 it used), seasonally adjusted claims would have come in at 393,000 instead of the reported 330,000 (555,708 divided by 1.442, rounded), or 63,000 claims (19 percent) higher.

There is some justification for treating the most recent week differently than the comparable week a year ago, because the same week last year included the Martin Luther King holiday. But I don’t believe that comes anywhere near justifying the entire 63,000-claim difference.

Let’s see how the three major business wires covered the results (bolds are mine):

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Three kinds of lies:

Lies
Damned lies
And statistics