Jobless claims increase, reflecting layoffs
Job seekers join a line of hundreds of people at a job fair in Manhattan. (March 5, 2009) Credit: AP
WASHINGTON - The number of people seeking jobless benefits jumped sharply this past week.
The Labor Department said Thursday that initial claims for unemployment aid rose by 20,000 to a seasonally adjusted 457,000 for the week ending Oct. 30. Wall Street analysts polled by Thomson Reuters had expected a smaller rise.
The increase comes after claims fell in four of the previous five weeks. Those drops had brought claims to their lowest level since July and raised hopes the job market was improving.
Instead, claims have risen back above the 450,000 level they have fluctuated around all year. They will need to drop below 425,000 to signal sustained job gains.
The weekly applications for unemployment benefits are volatile, but are considered a real-time snapshot of the job market. They reflect the pace of layoffs and indicate whether companies are hiring.
The four-week average of claims, a less volatile measure, rose by 2,000 to 456,000.
Claims fell steadily last year, from about 600,000 in June 2009 when the recession ended to about 470,000 at the end of the year.
There has been little improvement since then.
The unemployment claims report comes one day before the Labor Department is scheduled to release the jobs figures for October.
However a new U.S. Labor Department report on productivity showed a modest rebound in the July-September quarter while labor costs fell slightly.
Productivity grew at an annual rate of 1.9 percent in the third quarter, a rebound from a decline of 1.8 percent in the second quarter, the Labor Department reported Thursday. The second quarter decline had been the biggest drop in nearly four years.
Labor costs fell at a 0.1 percent rate in the third quarter after having risen 1.3 percent in the second quarter.
Even with the gain in productivity, the efficiency of U.S.
workers is still growing at a much weaker pace than last year.
Economists see that as an encouraging sign that companies will have to step up their hiring of laid-off workers.
A rebound in hiring would provide a welcome boost at a time that unemployment remains painfully high.
