Jobless Claims Lower, But Layoffs Continue

(AP)  Initial U.S. claims for unemployment benefits dropped more than expected last week, but mass layoffs continue amid a recession that appears to be deepening.

The Labor Department reported Thursday that new applications for jobless benefits fell to a seasonally adjusted 554,000 for the week ending Dec. 13, from an upwardly revised figure of 575,000 the previous week. The new tally was slightly below economists' expectations of 558,000 claims.

One likely reason for the improvement is that the figure was inflated two weeks ago by applicants who delayed filing their claims during the Thanksgiving holiday week in late November, a Labor Department analyst said. The government attempts to account for such volatility with its seasonal adjustments but is not always successful.

Still, the four-week moving average, which smoothes out fluctuations, increased slightly to 543,750 claims, the highest since December 1982. The labor force has grown by about half since then.

Another slight improvement was seen in the number of people who continue to receive jobless benefits, which declined to 4.38 million from 4.43 million the previous week. Economists expected a slight increase to 4.45 million.

Economists consider jobless claims a timely, if volatile, indicator of the health of the labor markets and broader economy. A year ago, initial claims stood at 349,000.

The elevated level of claims is just one of several signs that the labor market has deteriorated rapidly in recent months.

Large layoffs are occurring across many sectors of the economy. On Wednesday alone, hard drive maker Western Digital Corp., managed-care company Aetna Inc., and Newell Rubbermaid Inc., maker of products including Rubbermaid storage containers and Sharpie pens, announced mass job cuts.

Pharmaceutical company Bristol-Myers Squibb Co., International Paper Co. and Bank of America Corp. also announced layoffs in the past week.

"The continuing wave of layoffs suggests claims could soon top 600,000," David Resler, chief economist at Nomura Securities, wrote in a client note Wednesday.

The Labor Department said earlier this month that employers cut a net total of 533,000 jobs in November, sending the unemployment rate to 6.7 percent, the highest in 15 years.

[slim1h2o]

unemployed workers into the 17% range, even though the unemployment numbers will probably remain below 10%, the actual numbers are much much higher.

Posted by DebinOK1 at 10:35 AM : Dec 18, 2008

I agree, in fact that''s one of the things I harp on all the time, the numbers that they''re reporting are skewed.

I think your 17% may now be more like 20%, but either way, it''s bad.

[jeannettelj]

Maybe the reason the claims are lower is because folks going to file for unemployment have to wait 4-8 hours in line. Many get fed up and will come back another day or try to get there earlier the next time. Here in Arizona we have been told there is a 3-6 week wait for your first check. Some cities such as Phoenix are hiring extra workers but they all have to be trained. This country is a mess and hopefully something can be done soon.

[debinok1]

They need to report the actual number of people that are out of work not just receiving benefits, reports suggest a minimum of 75% of workers who filed for benefits over the last 3 years are still unemployed or are underemployed, that brings the grand total of actual unemployed workers into the 17% range, even though the unemployment numbers will probably remain below 10%, the actual numbers are much much higher.

[hitoyou11]

This is more BS. Jobless Claims Lower. Sure they are. Every one is Layed off. The ones that are out of unemployment benefits are not counted any more. This way people think things are getting better, when they are not. You can do anything with numbers. and the Labor Department along with comgress does just thay. Play with the jnumbers. What A JOKE.