Labor Department Takes a Double Hit

It has been a tough week for the Labor Department as it reported rising jobless claims and the Labor Secretary, Eugene Scalia, addressed the impact of the SolarWinds hack on the agency.


The Labor Department reported signs of a slowing economic recovery as first-time unemployment insurance claims jumped to 965,000 last week. The number shows the slowdown in hiring as a resurgence in the coronavirus causes cities to roll out restrictions once again.


The first-time unemployment numbers were also significantly higher than the Wall Street estimates of 800,000 for that week and above the previous week’s total of 784,000. The significant jump in unemployment claims puts the number at its highest level since mid-August.


New jobless claims are still a far cry from what they were at the peak of nearly seven million jobless claims filed in late March.


“That’s nowhere near what we saw in April, fortunately. But it’s not a pretty picture. We’re stuck at a level that’s four times where it should be,” said Beth Ann Bovino, U.S. chief economist for S&P Global Ratings.


Continuing unemployment claims reported by the Department of Labor also rose. Continuing claims grew by 199,000 to 5.27 million claims. The continuing claims figures are reported a week behind new jobless claims.


The latest labor statistics report coincides with Labor Secretary Eugene Scalia’s comments about the SolarWinds hack that was first reported on Dec. 8, 2020.


In an interview, Secretary Scalia confirmed that the Labor Department’s statistical arm, which prepares the jobs report and other market-focused information about the U.S. economy, was breached in the SolarWinds hack. Secretary Scalia called the incident a “serious episode” but assured the American people that the incident was isolated and that data wasn’t lost or corrupted in the hack.


“The public can have total confidence in the data that BLS has,” Secretary Scalia said


He added that the department determined that none of the bureau’s data was “exfiltrated” or transferred from the bureau’s systems. 


The SolarWinds hack affected several government agencies, including the U.S. departments of Homeland Security, State, Commerce, Treasury, and the National Institutes of Health. It was also reported that nuclear programs run by the U.S. Department of Energy and the National Nuclear Security Administration were also targeted.


At the end of December 2020, the Department of Labor released a statement about its security.


“The Bureau of Labor Statistics (BLS) is confirming a breach through the vulnerable SolarWinds Orion software that has impacted many of the users of the product. The Department of Labor (DOL), including BLS, is in close contact with the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency (CISA) regarding this event and is following their guidance. Out of an abundance of caution and following best practices, DOL and BLS have implemented heightened security reviews and monitoring on all of their systems and networks,” read the statement in part.

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