The latest report from the United States Department of Labor showed that the jobless claims declined to its lowest level in 4 years. The number of individuals who filed for initial claims on unemployment benefits for the week ending October 6 was 339,000. The figure is 30,000 lower than the previous week’s initial jobless claims of 369, 000.

Based on the data compiled by Bloomberg, the consensus jobless claims estimate by economists for the period was 370,000.

US Jobs

Based on the report of the Department of Labor, five states reported a decline in jobless claims, including Mississippi (-3, 393), Michigan (-2,639), Florida (-1,192), Ohio (-1,723), and Oregon (-1,135).

Media reports cited that the big drop in jobless claims was caused by a “mystery state.”  There were also rumors that the Department of Labor excluded the jobless claims of a large state.

The Business Insider interviewed one of the analysts in the Labor Department to clarify the issue. The analyst said that all states were included in the job claims report this week, and the allegation that a large state was excluded in the jobless claims report was not true.

The source said, California might have been short-staffed last week, and was unable to process all the job claims for the week. It is possible that some of the job claims were not reported on time to the Labor Department, which happens occasionally.

The job claims (estimated 15,000 to 25,000) that were not processed on time would be included in the following week’s report, according to the source.

If we were to add the 15,000 to 25,000 estimated job claims that were not delivered on time to the Department of Labor, the overall normalized job claims number would be around 355,000 to 365,000. The figure still beat the 370,000 estimate by economists.

Analysts also evaluated the new jobless claims during the past four weeks to settle the issue. The figure showed that the jobless claims declined by 11,500 to 364,000, for the period ending October 6, the lowest since May 2008.

Chris Rupkey, chief financial economist at the Bank of Tokyo-Mitsubishi in New York, said, “Today’s 339,000 likely exaggerates the improvement, but its story and the direction of the labor market is real.”

Last week, the Bureau of Labor Statistics reported that the unemployment rate dropped from 8.2 percent to 7.8 percent in September. According to the report, the economy added 114,000 private sector jobs, in line with the expectations of analysts.

Jack Welch, former CEO of General Electric Company (NYSE:GE) expressed doubt over the result of the unemployment rate, and tweeted that the numbers were manipulated in favor of the White House.

His tweet last October 5 reads, “Unbelievable jobs numbers..these Chicago guys will do anything..can’t debate so change numbers”.