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Local Area Unemployment Statistics
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Seasonal Adjustment for Weekly Unemployment Insurance Claims
The Department of Labor's Employment and Training Administration (ETA) contracts with the Bureau of Labor Statistics (BLS) to run the annual programs for weekly unemployment insurance (UI) claims seasonal adjustment.
Responsibilities
ETA collects the weekly UI claims reported by each state's unemployment insurance program offices and publishes a weekly news release. ETA uses the set of seasonal factors BLS provides annually and applies them to the unadjusted data from the regular UI program during that year. Concurrent with the implementation and release of the new seasonal factors, ETA incorporates revisions to the UI claims historical series caused by updates to the unadjusted data. ETA is the technical expert regarding UI claims data, and maintains these data at https://oui.doleta.gov/unemploy/claims.asp.
Once a year, BLS updates the models used to calculate seasonal adjustment factors for weekly UI claims. This process includes using all of the regular UI claims data available at that time, updating the parameter files, and identifying potential outliers. BLS is the technical expert regarding the seasonal adjustment process.
What is Seasonal Adjustment?
Seasonal adjustment is a statistical technique that attempts to measure and remove the influences of predictable seasonal patterns to reveal how weekly UI initial and continuing claims change from week to week.
Over the course of a year, the amount of UI claims undergoes fluctuations due to seasonal events including changes in weather, holidays, and school schedules. Because these seasonal events follow a more or less regular pattern each year, their influence on statistical trends can be eliminated by seasonally adjusting the data from week to week. These seasonal adjustments make it easier to observe the cyclical, underlying trend, and other nonseasonal movements in the series.
Inputs
The current factors most recently were revised from 2019 forward in conjunction with the news release on March 14, 2024. See below for additional information.
ETA Weekly UI Claims News Releases
History of UI Claims Seasonal Adjustment
Prior to 2002, a method of seasonal adjustment that was developed by staff of the Federal Reserve Bank (FRB) and BLS had been used for at least two decades. Data users voiced concerns about the volatility in the weekly seasonally adjusted initial claims estimates during highly seasonal periods. BLS evaluated an alternative method developed by the FRB and found it to improve the weekly seasonal adjustment over such periods. BLS and ETA introduced this alternative method to develop seasonal factors on April 11, 2002, effective with the release of claims data for the week ending April 6, 2002.
The pre-2002 method of seasonal adjustment assumed that the claims series had a fixed seasonality. That is, the claims data reflect a holiday or regular seasonal event the same way each year and the seasonal factors change only from the effects of the calendar. The alternative method assumes that the claims series exhibit variation in response to a seasonal event (moving seasonality). The alternative method allows the coefficients that determine the factors to change over time, in addition to reflecting the change based on calendar effects. (As part of testing the alternative method, it was confirmed that the claims series does in fact exhibit moving seasonality.)
In the development of seasonal factors, the alternative method uses claims data from the first few weeks of January. Extending the period into the current year more fully accounts for claimant activity during the holiday period and better captures seasonal movement. The pre-2002 method incorporated data only through December of the prior year in the development of new seasonal factors.
Coronavirus (COVID-19) pandemic impact
Beginning with the Unemployment Insurance Weekly Claims News Release issued on March 14, 2024, the methodology used to seasonally adjust the national initial claims and continued claims reflects a change in the type of model used for seasonal adjustment. The previous models were regression models that utilized locally-weighted regressions to allow for changing seasonality. The new models are structural time series models similar to those used by the Local Area Unemployment Statistics program for state labor force data since the late 1980s. A structural time series model has more advanced modeling capabilities than the models used in the past and will be easier for BLS to maintain moving forward. As usual, the revised seasonal adjustment factors show differences due to data revisions and the addition of another year’s worth of data, but some degree of difference is due to the model change. Documentation for the new modeling approach will be posted here later in 2024.
As noted in the annual revision documentation for prior years, before the pandemic, the seasonally adjusted UI claims series used multiplicative seasonal adjustment models. Starting with March 2020, BLS specified these series as additive. After the large effects of the pandemic on the UI claims series lessened, the seasonal adjustment models once again were specified as multiplicative. This is important since statistical tests show that the UI claims series should, in normal times, be estimated multiplicatively.
While the pandemic period is within our 5-year scope for revision, the UI claims series will use a hybrid adjustment. For the most volatile portion of the pandemic for these series, covering the week ending March 21, 2020, through the week ending June 19, 2021, the series are additively adjusted. These additive adjustments were not revised on March 14, 2024. Nor will they be subject to further revision. Before and after the highly volatile portion of the pandemic, the series are adjusted multiplicatively and in scope for regular revision. For consistency, all seasonal factors displayed in the factor files are shown as multiplicative, as the additive factors were converted to implicit multiplicative factors.
For Additional Information
Please submit inquiries to the Local Area Unemployment Statistics program.
Last Modified Date: March 14, 2024