US Government Asks States Not To Release Data On Rising Unemployment Claims

At a time when experts advise that greater transparency is essential during a crisis, the Trump Administration is trying to thwart release of rising unemployment information, which they believe is potentially worrisome to both financial markets and his reelection prospects.

The problem with this approach is that the market meltdown of the last two weeks is due, in part because the markets' have already processed similar projections they reached on their own - and because incomplete or false information leads to sub-optimal resource allocation and public policy decision making. JL


Mary Papenfuss reports in the Huffington Post :

The Trump administration’s Labor Department sent an email to state officials this week asking them to report new unemployment claims only in “generalities” to avoid spooking financial markets. Unemployment claims have been skyrocketing as thousands are laid off from jobs amid the spread of coronavirus. New claims for unemployment benefits climbed to 281,000 last week as the coronavirus pandemic shuttered businesses and left people out of work. It was the highest level since Sept. 2, 2017. In several states so many people applied for unemployment that websites went down.

The Trump administration’s Labor Department sent an email to state officials this week asking them to report new unemployment claims only in “generalities” to avoid spooking financial markets, The New York Times reported.

The email on Wednesday asked state labor authorities to only “provide information using generalities to describe claims levels (very high, large increase)” until the Labor Department releases the total number of national claims next Thursday.

 “States should not provide numeric values to the public,” Gay Gilbert, the administrator of the department’s Office of Employment Insurance, wrote in the email shared with the Times. The message noted that the figures are closely tracked by financial markets judging the strength of the economy.

Unemployment claims have been skyrocketing as thousands are laid off from jobs amid the spread of coronavirus. Treasury Secretary Steve Mnuchin reportedly warned senators that unemployment during the pandemic could hit 20% without a financial rescue package.

Georgia did not release exact figures. State Labor Department spokeswoman Kersha Cartwright told the Atlanta Journal-Constitution the state was not yet ready to reveal specific numbers — though she did not mention the memo.

New claims were so numerous that the state’s unemployment website was clogged, said Cartwright, adding: “We are seeing as many claims filed in a day as we usually see in a week.” 

National Public Radio

New claims for unemployment benefits climbed to 281,000 last week as the coronavirus pandemic shuttered businesses and left people out of work, the Labor Department said Thursday. It was the highest level since Sept. 2, 2017, when they totaled 299,000.

That latest number, for the week ended last Saturday, was an increase of 70,000 from the prior week. But the numbers are expected to jump even more this week as several states reported that their unemployment claims websites had crashed with so many people trying to file at the same time.

Oxford Economics said the report is "a small preview of what's to come. ... We expect the virus to cause significant job losses as the economy sinks into a deep recession."

The Labor Department said that "a number of states specifically cited COVID-19 related layoffs, while many states reported increased layoffs in service related industries broadly and in the accommodation and food services industries specifically, as well as in the transportation and warehousing industry, whether COVID-19 was identified directly or not."

While many companies now allow their employees to work at home, telecommuting isn't an option for many people. Restaurants, which have had to close except for pickup and delivery, have been particularly hard hit. And Ford, General Motors and Fiat Chrysler are suspending production until the end of March.

Colorado and other states have seen a spike in filings this week. On March 9 about 400 people filed new claims in Colorado, but at 10 a.m. Tuesday nearly 7,000 people were trying to enter their claims in the system, said Joe Barela, executive director of the Colorado Department of Labor and Employment.

Barela says that two weeks ago it took 10 minutes for callers to get through to the employment office. Now it takes at least an hour.

In Ohio, 78,000 people filed for unemployment during the first three days of this week alone, compared to 6,500 in all of last week.

In several states — including New York, Oregon and New Jersey — so many people applied for unemployment that websites went down.

"We saw a record number of unemployment insurance applications, so many in fact that the state system crashed," New Jersey Gov. Phil Murphy said.