WASHINGTON — The number of people filing new jobless claims plunged last week to a 41/2-year low.
Analysts said the report Thursday probably overstates what appears to be a moderately improving job market. It comes just days after officials reported that the unemployment rate fell in September to a post-recession low, which caused some Obama administration critics to claim that political interference skewed the data.
Thursday's report showed that there were 339,000 initial claims for unemployment benefits in the week that ended Saturday, a steep decline of 30,000 from the previous week.
The data are seasonally adjusted, and the claims numbers can be highly volatile from week to week, especially when there is a holiday or the weather is bad and government offices are closed. Early Thursday, skeptics began raising doubts over the weekly jobless claims report.
Business Insider, an online news blog, published a story saying California did not process all its jobless claims, contributing to the drop in claims last week. The post, which was widely circulated on Twitter and on the Web, cited an unnamed Labor Department source.
California officials, in a statement, promptly blasted the report and demanded a retraction.
"Reports that California failed to fully report data to the U.S. Department of Labor, as required, are incorrect and irresponsible," said Pam Harris, director of the state's Employment Development Department. "It's unfortunate that this 'reporter' and others who repeated the article's erroneous statements chose to speculate rather that report."
In an email to the Los Angeles Times, Business Insider editor Henry Blodget, who wrote the report, said the publication stood by the story.
Last week former General Electric chief Jack Welch tweeted that September jobs data were manipulated by the White House.
Welch, who was met with a barrage of criticism after his Twitter post, later defended his position in a column for the Wall Street Journal. In his op-ed piece, he reiterated his claim that it was unlikely that the jobless rate fell to 7.8% last month from 8.1% in August — the lowest since January 2009, when President Obama was sworn into office.
With the November presidential election less than a month away, charges of political bias in employment data have surfaced.
Some elected officials have raised questions over how the Labor Department handles reports.
Rep. Darrell Issa (R-Vista), chairman of the House Oversight and Government Reform Committee, has questioned how the government handles jobs data.
Issa "believes there are legitimate questions about the Department of Labor's method for calculating unemployment" and has "specifically pointed to the frequent revisions" of those numbers by the department after they are released, said his spokesman, Frederick Hill. But Issa has no plans to hold a hearing on the controversy over the latest jobs data, Hill said.
Jobless claims reflect layoffs, which have receded somewhat in recent months even as there's been little evidence of any big movement in hiring. The last time weekly claims were as low as 339,000 was in February 2008 as the economy was beginning what would be a rapid descent. Initial jobless claims rose to a high of 586,000 near the end of 2008, peaking at 667,000 in March 2009.
Over the last year, initial weekly claims generally have been hovering in the high-300,000 territory.
To smooth out the week-to-week volatility, many analysts look at a four-week moving average of new jobless claims. That figure fell 11,500 to 364,000 for the period ending Oct. 6 — the lowest reading for the measure since May 2008.
"Today's 339,000 likely exaggerates the improvement, but its story and the direction of the labor market is real," said Chris Rupkey, chief financial economist at the Bank of Tokyo-Mitsubishi in New York.
Lopez reported from Los Angeles and Lee from Washington. Times staff writer Jim Puzzanghera in Washington contributed to this report.