IBJNews

National unemployment claims drop sharply

Back to TopCommentsE-mailPrintBookmark and Share

Fewer people applied for unemployment benefits last week, the second drop in a row and a hopeful sign the job market could be improving.

The Labor Department said Thursday that initial claims for jobless benefits dropped by 21,000 to a seasonally adjusted 434,000 in the week that ended Oct. 23.

It was the second-lowest number for claims this year. The only time it was lower was during the July 10 week, and that week was affected by the Independence Day holiday when state unemployment offices were closed.

Stock futures rose after the report was released. Wall Street analysts had expected a tiny increase.

Claims will need to keep falling to signal a widespread increase in hiring. Claims have fluctuated around 450,000 for most of this year, and have fallen below that level seven times. But they have always rebounded in subsequent weeks, and haven't remained below 450,000 for longer than two weeks.

John Ryding, an economist at RDQ Economics, said in a note to clients that the drop is "encouraging." But he added that "we would need to see a couple more weeks of lower claims readings to be comfortable that employment growth is improving."

The four-week average, a less volatile measure, dropped by 5,500 to 453,250, the lowest level since the week of July 24.

Applications for unemployment aid fell steadily last year after the recession ended in June 2009, dropping from 600,000 to about 450,000 by January of this year.

Employers haven't done much hiring in recent months with economic growth so weak. The economy grew 1.7 percent in the April-June period, an anemic pace in normal times and even worse in the aftermath of the Great Recession.

Economists expect that the Commerce Department on Friday will report slightly better growth of 2 percent for the July-September period. But that's still sluggish after a deep recession.

The economy needs to grow by at least 5 percent for a full year to bring down the unemployment rate by a percentage point, economists estimate. The jobless rate is currently 9.6 percent, down only slightly from 9.7 percent in January.

Some companies are adding workers. Pharmaceuticals company Novartis AG said Wednesday that it will add 300 new jobs and invest $600 million over the next five years in its research headquarters in Cambridge, Mass. And engine maker Cummins Inc. said Tuesday that it will expand its headquarters in Columbus and add at least 350 jobs by 2012.

The number of people continuing to receive jobless aid also dropped sharply last week, falling by 122,000 to 4.36 million, the department said. But that doesn't include an additional group that is receiving extended benefits under an emergency program approved by Congress during the recession.

The emergency benefit rolls fell by more than 400,000 to about 4.7 million for the week ending Oct. 9, the latest data available. Much of the decline is likely due to people using up all the unemployment aid they are eligible for.

All told, about 8.8 million people received unemployment benefits that week.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. Liberals do not understand that marriage is not about a law or a right ... it is a rite of religous faith. Liberals want "legal" recognition of their homosexual relationship ... which is OK by me ... but it will never be classified as a marriage because marriage is a relationship between a man and a woman. You can gain / obtain legal recognition / status ... but most people will not acknowledge that 2 people of the same sex are married. It's not really possible as long as marriage is defined as one man and one woman.

  2. That second phrase, "...nor make or enforce any law which shall abridge the privileges or immunitites of citizens..." is the one. If you can't understand that you lack a fundamental understanding of the Constitution and I can't help you. You're blind with prejudice.

  3. Why do you conservatives always go to the marrying father/daughter, man/animal thing? And why should I keep my sexuality to myself? I see straights kissy facing in public all the time.

  4. I just read the XIV Amendment ... I read where no State shall deprive any person of life, liberty, or property ... nor make or enforce any law which shall abridge the privileges or immunitites of citizens ... I didn't see anything in it regarding the re-definition of marriage.

  5. I worked for Community Health Network and the reason that senior leadership left is because they were not in agreement with the way the hospital was being ran, how employees were being treated, and most of all how the focus on patient care was nothing more than a poster to stand behind. Hiring these analyst to come out and tell people who have done the job for years that it is all being done wrong now...hint, hint, get rid of employees by calling it "restructuring" is a cheap and easy way out of taking ownership. Indiana is an "at-will" state, so there doesn't have to be a "reason" for dismissal of employment. I have seen former employees that went through this process lose their homes, cars, faith...it is very disturbing. The patient's as well have seen less than disireable care. It all comes full circle.

ADVERTISEMENT