Jobless Benefit Rolls Post First Drop In Months
AP, June 18, 2009 · The total number of people on the unemployment insurance rolls dropped for the first time since early January, the government said Thursday, while new claims for benefits rose slightly.
The Labor Department said the total unemployment insurance rolls fell by 148,000 to 6.69 million in the week ending June 6 — the largest drop in more than seven years. The decline may be a sign that layoffs are easing.
The drop also breaks a string of 21 straight increases in continuing claims, the last 19 of which were records. A dip in continuing claims several weeks ago was later revised higher.
The department also said initial claims rose 3,000 to a seasonally adjusted 608,000 last week, above analysts' expectations. The four-week average, which smooths fluctuations, fell by 7,000 to 615,750. Continuing claims data lags initial claims by one week.
The drop in continuing claims could signal a slowing in the rise of the unemployment rate, which reached a 25-year high of 9.4 percent in May. Many economists forecast the rate could reach 10 percent by the end of the year.
Still, millions of Americans are receiving unemployment compensation under an emergency federal program authorized by Congress last summer and extended by the Obama administration's stimulus package.
About 2.36 million people received benefits under that program in the week ending May 30, an increase of more than 102,000 from the previous week. That's in addition to the 6.7 million people receiving benefits under the 26-week program typically provided by states.
Economists also are closely watching the level of first-time claims for signs the economy will recover by mid-summer, as many analysts predict.
"If the labor market is indeed stabilizing, we should see a marked decline in new unemployment filings in the weeks ahead," economists at Wrightson ICAP wrote in a note to clients this week.
