New Jobless Claims Drop to 522K

(AP)  The number of newly laid-off Americans signing up for unemployment benefits last week, and those using this safety net over a longer period, both plunged. But the government figures released Thursday were clouded by difficulties adjusting for temporary shutdowns at auto plants.

Even if the recession ends this year as the Federal Reserve and many private economists expect, companies are expected to keep trimming payrolls. The unemployment rate will climb because companies won't be in any mood to hire until they feel certain a recovery is firmly rooted.

The Labor Department said new applications for unemployment insurance dropped by a seasonally adjusted 47,000 to 522,000, the lowest level since early January. Economists polled by Thomson Reuters expected claims to rise to around 575,000.

A department analyst said the drop in new claims didn't point to improvements in economic conditions. The second straight weekly decline reflected problems adjusting layoffs for temporary shutdowns at General Motors and Chrysler plants to retool for new models.

The unadjusted figures actually showed that new claims rose by 86,389 last week, which would push the total to 667,534.

The department's seasonal adjustment process expected a large increase in claims from auto workers and some other manufacturers, the analyst said. Since that didn't happen, seasonally-adjusted claims fell.

(AP/Department of Labor)

Those adjustment difficulties also were behind a big drop reported for people continuing to draw unemployment benefits, the analyst said.

The number of people still collecting benefits fell by a seasonally adjusted 642,000 to 6.27 million, the lowest level since mid-April.

The unadjusted figures for continued claims showed an increase of 63,714. That data lags initial claims by a week.

When federal and state emergency programs are included, the total benefit rolls are higher. More than 2.8 million are receiving unemployment insurance under the programs, which add up to 53 weeks of benefits on top of the typical 26 weeks. The data for the emergency programs lags the initial claims by two weeks. About 9.1 million people received jobless benefits the week ending June 27.

The layoffs picture is expected to be muddied by the auto shutdowns in the weeks ahead, the department analyst said.

The shutdowns typically occur in the summer, but took place over the last two months as GM and Chrysler LLC sought bankruptcy protection and implemented sweeping restructuring plans. That means the government data is more volatile than usual, making it harder to draw firm conclusions from the report about the direction of the economy and the pace of future layoffs.

The Fed, in a new forecast issued Wednesday, predicted the jobless rate would top 10 percent this year. It rose to 9.5 percent, a 26-year high, in June.

The recession, which started in December 2007 and is the longest since World War II, has snatched a net total of 6.5 million jobs.

Earlier this week, US Airways announced that it will cut 600 jobs this fall as it continues to struggle with the slow economy. Gannett Co. recently said it planned to eliminate 1,400 positions and credit card issuer Advanta Corp. says it's laying off half its work force.

Among the states, Michigan reported the largest increase in initial claims, with 12,144, which it attributed to higher layoffs in most industries. The next largest increases were reported by New York, Wisconsin, Indiana and Ohio. The state data lags initial claims by one week.

New Jersey reported the largest decrease, with 5,030, which it attributed to a shorter work week and fewer layoffs in the transportation, trade, service and warehousing industries. California, North Carolina, Kansas and Oregon reported the next largest drops.

[prodeath]

What the hell do u people think Obama has, a majic wand. Its going to take at least a year to clean up the mess that Cheney / Bush cronies left for Obama. For one thing, only about 10% of stimulus has been spent. And if it wasn't for the stimulus, the unemployment rate would probably be around 11%. So, shut ur pie hole and give the economy some time to recover. And if in 6 or 7 months the economy is still in a horrible mess and more than half of the stimulus has been spent. Then we can start grumbling that the stimulus was a waste of money. To me, it just sounds like a bunch of ultra right wingers who want Obama to fail.

[GovernmentControl]

The obama/media complex tries and tries to spin the news of another half a million americans out of work, yet somehow obamas approval numbers continue to plunge. When will the obama/media complex admit the "stimulus" was the greatest waste of tax payer money in american history?

[beaumuff]

Maybe you should have gave that speech to Bill Clintstone.

[presjfk]

This is good news?

[sjc_1]

These numbers still are not good enough, but considering where we were in March, they are better. It will take a while for finance and credit to come back around, then we will see business activity and more jobs.

[anti-global2]

This article is not being up front, and CBS needs to stop trowing out B.S. to try and make a disastor look like anything less. 60%+ of corporation who have laid off workers have already said they have no intention of hiring those workers back even after the recovery, therefore these unemployment levels are going to be long term. I am not blaming one administration over the other, I think they both did and are doing alot of damage to the economy.
A few truths that they tried to bury in this article are:
"The shutdowns typically occur in the summer, but took place over the last two months as GM and Chrysler LLC sought bankruptcy protection and implemented sweeping restructuring plans. That means the government data is more volatile than usual, making it harder to draw firm conclusions from the report about the direction of the economy and the pace of future layoffs."
And
"New Jersey reported the largest decrease, with 5,030, which it attributed to a shorter work week and fewer layoffs in the transportation, trade, service and warehousing industries. California, North Carolina, Kansas and Oregon reported the next largest drops."
I hate to say it but there are no "green shoots" for American workers and we will not be out of this depression by next year. The reason I say depression is because a recession is a temporary problem with supply and demand levels. In this case the market will correct itself. This is not a problem with supply and demand. This is a problem with intentionally created bubbles, like they are trying to create with green energy, manipulation of markets, bad loans, credit swap derivatives ect.
The only ones that will benifit from this are the rich and powerful, the rest of us will continue to struggle and work more for less. In additiona because of the manipulating of commodities we will not even have the benefit of lower food prices, they are keeping them artifically high.

[rushlimpdrug]

All the stimulus money is trickle down money.
So far, it hasn't trickled down much.
This seems odd since Obama spoke of change.

Change in this case is a slow boat to China.

[Livinontheedge]

This proves Obamas stimulus is worlking. It will still take the better part of 2 years to see a real change in the situation. A big raspberry to the Obstructionist GOP.

[azure13]

IThoughtItWasFunnyNupe...
It amazes me that people like you get all upset when we finally spend money on America for a change, but do not complain about the billions upon billions wasted in Iraq and Afghanistan for wars that did not have to be started.
Now we are stuck there, throwing away more billions.
You people are nuts. Imagine if all that money had been spent on improving our infrastructure and other American initiatives. We probably wouldn't even be in the economic mess we have now.