U.S. Weekly Jobless Claims Rise Amid Government Shutdown

The number of Americans filing new applications for unemployment benefits rose again last week, economists estimated, suggesting early layoffs among contractors affected by the U.S. government shutdown, Lucia Mutikani reported for Reuters.

States continue to collect unemployment data in the face of the government shutdown and submit it to the Labor Department’s database, which remains accessible. (Photo: U.S. Department of Labor Facebook)

Initial claims for state unemployment benefits increased to a seasonally adjusted 235,000 for the week ending Oct. 4, up from 224,000 the prior week, according to economists at JPMorgan and Goldman Sachs.

The figures include estimates for Hawaii and Massachusetts, whose data were unavailable. Citigroup estimated 234,000 claims last week.

Official economic data collection and publication have been suspended due to the government shutdown, now in its second week.

However, states continue to collect unemployment data and submit it to the Labor Department’s database, which remains accessible.

The shutdown, caused by a lapse in federal funding, has delayed the release of the closely watched September employment report—critical for decision-making by the Federal Reserve, businesses, and households.

“The increase could be due to government contractors filing for unemployment benefits while temporarily laid off as the government is shut down,” said Gisela Young, an economist at Citigroup.

“Initial claims also increased during October 2013, the last full government shutdown. We would expect claims to either increase further or stay elevated next week as well.”