Unemployment Claims Jump
The number of workers seeking unemployment insurance for the first time rose 13,000 to 399,000 in the latest week, the Labor Department said Thursday.
About half the increase in claims resulted from workers who were unable to file for unemployment insurance in the previous week as a result of Hurricane Isabel, the department said.
The four-week average of claims in the week ended Sept. 27 fell 5,000 to 403,500, marking the fifth straight week above 400,000. Economists prefer to watch the trends in the four-week average, which smoothes out one-time events, such as weather and holidays.
"The four-week average of claims has fallen to the lowest level in four weeks. However, at 403,500, these data do not suggest that hiring has picked up significantly in the weeks following the September employment survey," said economist John Ryding of Bear Stearns.
The Labor Department is scheduled to release its monthly employment report Friday morning. Economists polled by CBS MarketWatch expect the unemployment rate to rise to 6.2 percent from 6.1 percent, with 15,000 jobs lost in the month.
Many economists see the 400,000 mark as the dividing line between job growth and job loss.
The four-week average figure is "indicative of an economy that is still shedding jobs on a net basis, which is a very disappointing situation some 22 months into the official recovery," said Joshua Shapiro, chief U.S. economist at MFR, Inc.
"The labor market remains the economy's Achilles heel, and unless it begins to improve it is doubtful that the consumer will be in a position to carry the load necessary to deliver the type of GDP growth in 2004 that just about everyone is banking on," Shapiro added.
Continuing claims rose to their highest level since June. The four-week average for continuing claims rose by 62,000 to 3.67 million in the week ended Sept. 20. Continuing claims include workers who have already filed an initial jobless claim, and are now drawing unemployment benefits.
And the insured unemployment rate, the percentage of covered workers receiving unemployment checks, stayed at 2.9 percent.
The continuing claims figures do not include some 800,000 workers receiving federal benefits, which are available to workers who have exhausted their state benefits, typically after six months.
Analysts say many workers are also exhausting their federal benefits before finding work. About 9 million Americans are officially classified as unemployed and 4 million more are either underemployed or discouraged and not looking for job.
In a separate report, the Commerce Department said factory orders fell a sharper-than-expected 0.8 percent in August after rising 2.0 percent in July. Orders for durable goods sank 1.1 percent, while orders for non-durables fell 0.5 percent.