Initial Jobless Claims Rise Unexpectedly
Vince Veneziani|Dec. 10, 2009, 8:50 AM | 255 |3
PrintTags: Unemployment, Jobs, Recession
New jobless claims are up, but the good news is that they remain below 500,000, which is seen as a crucial level.
So we'll call a wash.
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AP: The number of newly laid-off workers seeking unemployment benefits likely rose last week, after dropping for five straight weeks.
A Labor Department report is expected to show new unemployment insurance claims rose by 3,000 to a seasonally adjusted 460,000, according to economists surveyed by Thomson Reuters.
Economists closely monitor initial claims, which are considered a gauge of the pace of layoffs and an indication of companies' willingness to hire new workers.
A recent, rapid drop in claims has given hope to many analysts that job cuts are slowing and hiring may even improve as soon as January or February. Claims have dropped by 75,000, or 14 percent, since late October.
Last week's report said 457,000 people filed first-time claims, the lowest total since the week of Sept. 6, 2008. Thursday's report is due at 8:30 a.m. EST.
Despite the recent improvement, claims likely have to fall to about 425,000 for several weeks to signal the economy is actually adding jobs, according to many analysts.
Last week, the Labor Department said employers shed a net total of 11,000 jobs in November, down from the 111,000 lost in October and a much better figure than analysts expected. The unemployment rate fell to 10 percent from 10.2 percent.
The number of people continuing to claim benefits, meanwhile, is expected to drop by about 25,000 to 5.4 million for the week ending Nov. 28. Those figures lag initial claims by a week.
But the so-called continuing claims do not include millions of people that have used up the regular 26 weeks of benefits typically provided by states, and are receiving extended benefits for up to 73 additional weeks, paid for by the federal government.
About 4.5 million people were receiving extended benefits in the week ended Nov. 14, the latest data available. That's an increase of about 300,000 from the previous week, and reflects an extension of benefits that Congress enacted last month.
The economy grew at a 2.8 percent pace in the July-September quarter and analysts say it is likely growing at a similar pace in the current quarter. But that is much slower than the average 6 percent rate in previous economic recoveries. As a result, most economists expect the unemployment rate to rise in coming months and remain above 9 percent through the end of next year.
Some employers are continuing to lay off workers. Consol Energy said Tuesday that it will lay off nearly 500 workers and idle a mountaintop removal mining operation near Bickmore, W.Va. The Pittsburgh-based company blamed an environmental lawsuit.
The Los Angeles School Board on Tuesday approved a budget plan that would cut 5,000 jobs, including about 1,400 teachers.
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ITS ON PURPOSE!
