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GAO: Labor Department 'improperly presented' jobless data

The Labor Department’s weekly reports on unemployment claims are relying on “inappropriate” methods and have “improperly presented” data on the number of claimants as a result, according to a report by the Government Accountability Office (GAO).

In normal times, the Labor Department uses the number of initial jobless claims that states report each week to estimate the total number of claimants in a given week. 

But since the pandemic upended the U.S. economy, that method has led to an inaccurate tally, which is likely overstating the number of people collecting unemployment insurance.

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“Because backlogs in processing a historic volume of claims have led to individuals claiming multiple weeks of benefits at a time for previous weeks of unemployment, as well as other data issues, these traditional estimates have not been appropriate in the context of the pandemic,” the GAO found.

In other words, if a single person submits multiple claims over the course of a reporting period —something that would be rare in normal times — the Labor Department's methods would count each claim as a separate individual claimant. A claimant jumping from one program to another in a piecemeal system could get counted multiple times.

In California, which reports its new claims every two weeks, the GAO said the total number of claims could outstrip the total number of people by nearly 50 percent.

Similarly, not all states report their data in the same time frame, which could skew the data from week to week depending on which states are reporting. 

Those disparities mean that the Labor Department’s data showing that 20.4 million people were claiming unemployment benefits through some program or another as of mid-November could be wildly inaccurate. 

The GAO report estimated that as of October, 11 million people were unemployed, compared with just under 5.9 million people before the pandemic, though that figure may not account for part-time employees and others eligible for benefits. The Commerce Department estimates that north of 10 million people have remained in the jobless ranks since the start of the year.

The flaws in the data could make it harder for Congress and other policymakers to respond to the pandemic’s true economic effects.

“Without an accurate accounting of the number of individuals who are relying on [unemployment insurance] benefits in as close to real-time as possible, policy makers may be challenged to respond to the crisis at hand,” the GAO warned.