The number of Americans filing first-time claims for unemployment insurance fell to the lowest level since July 2008 last week, showing further strength in the labor market after the jobless rate declined to a 21-month low.Applications for jobless benefits decreased by 36,000, more than forecast, to 383,000 in the week ended Feb. 4, Labor Department figures showed today. Economists forecast claims would fall to 410,000, according to the median estimate in a Bloomberg News survey. The total number of people receiving unemployment insurance fell, while those collecting extended payments increased.
A slowdown in firings means U.S. companies may begin creating enough jobs to keep unemployment going down after the rate’s biggest two-month decline since 1958. Federal Reserve Chairman Ben S. Bernanke yesterday said the jobless rate will likely stay high “for some time” as companies remain reluctant to add to payrolls.
“The first indication that we’re going to see strength falling into the labor market is a sustainable decline in initial claims,” Lindsey Piegza, an economist at FTN Financial in New York, said before the report. “This is a step in the right direction, signaling that, on the margin, businesses will begin to take on new employees.”
Over the last few weeks, we've seen spikes in this number which were supposedly caused by the weather. Now we know those claims were pretty much true.
5 comments:
Now me know those claims were pretty much true.
Thank you for your trenchant economic analysis, Cookie Monster:)
I wonder if we will see at least one more weather related spike in jobless claims. There was that blizzard last week, so it we may see an increase in the report released next week. I do think the trend is clearly moving lower here, but I think we might have to ride that weather roller coaster at least more time when it comes to initial claims.
I'm still wondering how large of an impact the retiring baby boomers is going to have on unemployment and the economy as a whole. That note of 10,000 people a day turning 65 got the numbers rolling around in my head. That means ~300k possible retiree's a month vs. ~165k a month population growth in the labor market. Now, to me at least, that sounds like a recipe for unemployment dropping a lot faster than the job creation numbers would suggest.
Anon -
The question about the baby boomers is very interesting. I've been discussing that idea with several people over the last few days. No one has any firm ideas, but the talk was very intriguing.
It's interesting that people can shop (retail sales up) but not work even 1 hr per week when the weather is bad.
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