unemployment benefits

Jobless Claims Tumble to Lowest Level Since 2008

December 15, 2011 by NewsMaker Leave a Comment

Far fewer people sought new unemployment benefits last week than just three months ago, the Labor Department said Thursday.

The number of people applying for benefits fell last week to 366,000, the fewest since May 2008. If the number stay that low consistently, it could signal that hiring is strong enough to lower unemployment, analysts say.

The unemployment rate in November was 8.6 percent. The last time jobless applications were this low, the rate was 5.4 percent.

Other economic indicators released Thursday were mixed. Wholesale prices rose a modest 0.3 percent last month, whileindustrial production fell 0.2 percent.

Economists said the decline in output at the nation’s factories, mines and utilities was not good news, but they also noted it followed steady gains over the previous six months.

The four-week average of unemployment applications, which smooths fluctuations, dropped last week to 387,750. That’s the lowest four-week average since July 2008. The four-week average has declined in 10 of the last 12 weeks.

“Labor market conditions have taken a turn for the better in recent weeks,” Michael Gapen, an economist at Barclays Capital, said in a note to clients. “Payroll growth should improve in the coming months.”

Applications for unemployment benefits are a measure of the pace of layoffs. Job cuts have fallen sharply since the recession, but employers have been hiring at only a modest pace. When applications fall below 375,000 consistently, that usually signals that hiring is strong enough to lower the unemployment rate.

The downward trend comes as Congress is wrangling over whether to extend emergency unemployment benefits, which are set to expire at the end of this year.

Other recent reports have suggested that the job market is improving a bit. In the past three months, net job gains have averaged 143,000 a month. That compares with an average of 84,000 in the previous three months.

In November, employers added 120,000 jobs, and the unemployment rate fell to 8.6 percent from 9 percent. That was the lowest unemployment rate in 2 and a half years. But about half that decline occurred because many of the unemployed gave up looking for work. When people stop looking for a job, they’re no longer counted as unemployed.

About 6.7 million people are receiving unemployment benefits. About 2 million will lose their benefits by mid-February if the emergency program expires.

Lawmakers differ over how long benefits should last. The House passed a Republican bill Tuesday that would renew emergency aid but reduce the maximum duration to 59 weeks from the current 99 weeks.

Democrats want to keep the full 99 weeks. The measure is part of broader legislation in the Democratic-led Senate that would also extend a Social Security tax cut.

The decline in manufacturing output reported by the Federal Reserve was the first in seven months and was largely because factories made fewer autos. But production of home electronics, appliances and business equipment also dropped.

Economists noted that more recent data from regional Fed banks suggests manufacturing grew sharply in both the Northeast and Philadelphia region in December.

“One month is not a trend,” said Dan Greenhaus, chief global strategist with BTIG.

Factory output, the biggest component of industrial production, decreased 0.4 percent, the Federal Reserve reported. The decline was mainly because of steep drop in the production of motor vehicles and parts. When stripping out auto production, which can be volatile from month to month, factory output fell just 0.2 percent.

Meanwhile, companies paid 0.3 percent more for such items as food and pharmaceuticals. But energy prices barely rose, keeping inflation in check.

In the 12 months ended in November, wholesale prices have increased 5.7 percent, down from a 5.9 percent year-over-year pace in October, the Labor Department said Thursday. It’s the smallest yearly increase since March. The department’s producer price index measures price changes before they reach consumers.

Excluding the volatile food and energy categories, the so-called “core” index rose 0.1 percent, after a flat reading the previous month. In the 12 months ending in November, the core index rose 2.9 percent, up a yearly pace of 2.8 percent in October.

Most economists say they think inflation has peaked and will slowly decline next year. That’s because prices for oil and many agricultural commodities have fallen from their highs this spring. Slower growth in China and a possible recession in Europe have reduced global demand for energy and other goods.

Producer price inflation “appears to have peaked and begun a slow retreat,” Steven Wood, an economist at Insight Economics, said in a note to clients.

Lower price growth means consumers will have more buying power, potentially raising consumer spending. The jump in gas and food prices earlier this year limited the ability of consumers to buy other goods, thereby slowing the economy.

Article source: http://feeds.nytimes.com/click.phdo?i=3266aa532a0b272691c41e1fc13a91b9

Filed Under: Economy News Tagged With: recession, six months, unemployment benefits

Economix Blog: Casey B. Mulligan: How Unemployment Benefits Became Twice as Generous

November 2, 2011 by NewsMaker Leave a Comment

12:48 p.m. | Updated to revise reference to standard benefit period.

Casey B. Mulligan is an economics professor at the University of Chicago.

Government spending on unemployment insurance has soared, and it’s hard to imagine the program ever shrinking back to its prerecession size.

Today’s Economist

Perspectives from expert contributors.

Unemployment insurance is jointly administered and financed by the federal and state governments, offering money to people who have lost their jobs and have as yet been unable to find and start a new job. On average they receive about $300 a week until they start working again, they stop looking for work or their benefits are exhausted.

Between 2006 and 2010, inflation-adjusted spending on unemployment compensation by state and local governments more than tripled.

The program has been around for decades, but the most recent recession and continued economic weakness has created an especially large group of laid-off workers who, despite an extensive search, cannot find another job. More unemployed people equals more spending for the unemployment insurance program, so we expect the program to be spending a lot during a recession.

However, the unemployment program has also become more generous in recent years. Before the recession, an unemployed person in a state without high unemployment would often exhaust benefits after 26 weeks; that is, the program would stop paying after the 26th weekly benefit, even if the beneficiary was still without work.

The federal law in place before the recession included some local labor market “extended benefit” triggers that, based on the statewide unemployment rate, would automatically lengthen the maximum benefit period. These automatic triggers began to extend benefits around the nation in the middle of 2008.

About the same time, new “emergency unemployment compensation” legislation extended maximum benefit periods for the entire nation. The American Recovery and Reinvestment Act of February 2009 further extended these “emergency” periods to up to 99 weeks, and legislation later in 2009 and in 2010 permitted the 99-week maximum to continue. (Among other unemployment insurance expansions, the act also increased monthly benefit amounts and excluded from federal personal income taxation the first $2,400 of benefits received in 2009.)

The chart below shows the size of the “emergency” and extended-benefit expansions, by quarter, measured as a fraction of the entire unemployment insurance program. Essentially, no “emergency” and extended-benefit benefits were paid in 2007 or in the first half of 2008. “Emergency” and extended-benefit benefits immediately became about a quarter of all unemployment insurance benefits and beneficiaries and were a majority of all unemployment insurance benefits by the end of 2009 (the two measures are slightly different because they come from different data sources).

Because “emergency” and extended-benefit benefits are paid to people only when they have exhausted the normal benefits, the fraction shown in the chart is a measure of how much unemployment benefits are paid pursuant to unemployment insurance rule changes, as opposed to payments that occur merely because more people were losing their jobs.

If we assume, merely for simplicity, that the expansions had no effect on the number of people unemployed or on the length of time they were employed, then setting “emergency” and extended-benefit payments to zero as they were in 2007 would have cut total unemployment insurance benefit payments by the fraction shown in the chart. In this case, it appears that the unemployment insurance program is at least twice as generous as it was in 2007, thanks to the federal changes in benefit rules.

The unemployment insurance program is a good example of how federal government spending has grown and how tough it will be to bring it back to pre-recession levels. People are now used to having well more than one year’s unemployment benefits available to them, and politicians will have a lot of trouble asking them to make do with just 26 weeks.

This post has been revised to reflect the following correction:

Correction: November 2, 2011

An earlier version of this post misstated the typical benefit period. Before the recession, 26 weeks, not 13, had become the typical maximum for states to pay unemployment benefits.

Article source: http://feeds.nytimes.com/click.phdo?i=9fd2fdb63d91150eee7c2681bd0e7ebd

Filed Under: Economy News Tagged With: government spending, maximum benefit, unemployment benefits

Recession Officially Over, U.S. Incomes Kept Falling

October 10, 2011 by NewsMaker Leave a Comment

Between June 2009, when the recession officially ended, and June 2011, inflation-adjusted median household income fell 6.7 percent, to $49,909, according to a study by two former Census Bureau officials. During the recession — from December 2007 to June 2009 — household income fell 3.2 percent.

The finding helps explain why Americans’ attitudes toward the economy, the country’s direction and its political leaders have continued to sour even as the economy has been growing. Unhappiness and anger have come to dominate the political scene, including the early stages of the 2012 presidential campaign.

President Obama recently called the economic situation “an emergency,” and over the weekend he assailed Congressional Republicans for opposing his jobs bill, which includes tax cuts that would raise take-home pay. Republicans blame Mr. Obama for the slump, saying he has issued a blizzard of regulations and promised future tax increases that have hurt business and consumer confidence.

Those arguments may be heard repeatedly this week, as the Senate begins debating the jobs bill. The full bill — a mix of tax cuts, public works, unemployment benefits and other items, costing $447 billion — is unlikely to pass, but individual parts seem to have a significant chance.

The full 9.8 percent drop in income from the start of the recession to this June — the most recent month in the study — appears to be the largest in several decades, according to other Census Bureau data. Gordon W. Green Jr., who wrote the report with John F. Coder, called the decline “a significant reduction in the American standard of living.”

That reduction occurred even though the unemployment rate fell slightly, to 9.2 percent in June compared with 9.5 percent two years earlier. Two main forces appear to have held down pay: the number of people outside the labor force — neither working nor looking for work — has risen; and the hourly pay of employed people has failed to keep pace with inflation, as the prices of oil products and many foods have jumped.

During the recession itself, by contrast, wage gains outpaced inflation.

One reason pay has stagnated is that many people who lost their jobs in the recession — and remained out of work for months — have taken pay cuts in order to be hired again. In a separate study, Henry S. Farber, an economics professor at Princeton, found that people who lost jobs in the recession and later found work again made an average of 17.5 percent less than they had in their old jobs.

“As a labor economist, I do not think the recession has ended,” Mr. Farber said. “Job losers are having more trouble than ever before finding full-time jobs.”

Mr. Farber added that this downturn was “fundamentally different” from most previous ones. Historically, other economists say, financial crises and debt-caused bubbles have led to deeper, more protracted downturns.

Mr. Green and Mr. Coder said the persistently high rate of unemployment and the long duration of unemployment helped explain the decline in income during the recovery.

In the recession, the average length of time a person who lost a job was unemployed increased to 24.1 weeks in June 2009, from 16.6 weeks in December 2007, according to the federal Bureau of Labor Statistics. Since the end of the recession, that figure has continued to increase, reaching 40.5 weeks in September, the longest in more than 60 years.

The new study by Mr. Green and Mr. Coder is based on monthly census surveys, rather than the annual data that appeared in last month’s census report on income. The monthly figures allow researchers to measure income changes more precisely during a recession or a recovery and provide more current information. The annual report is based on surveys conducted early in the following year, and people sometimes confuse how much money they are making at the time of the survey with how much they made the previous year. Additionally, recessions usually do not line up with a calendar year.

A committee of academic economists at the National Bureau of Economic Research, a private group widely considered the arbiter of the business cycle, judged that the most recent recession began in December 2007. The bureau defines a recession as a significant, broad-based decline in economic activity.

The economists said the recession ended in June 2009. In every quarter since then, the economy has grown.

Some economists see signs that the United States may be in or about to enter another recession, though the evidence is mixed.

In their new study, Mr. Green and Mr. Coder found that income dropped more, in percentage terms, for some groups already making less, a factor that they say may have contributed to rising income inequality.

From June 2007 to June of this year, they said, median annual household income declined by 7.8 percent for non-Hispanic whites, to $56,320, and by 6.8 percent for Hispanics, to $39,901. For blacks, household income declined 9.2 percent, to $31,784.

Mr. Green and Mr. Coder, who both worked at the Census Bureau for more than 25 years, found other income changes over the four-year period examined.

For example, income, after adjustment for inflation, declined fairly substantially for households headed by people under age 62, but it rose 4.7 percent for those headed by people 65 to 74, many of whom are not in the labor force. The change was negligible for those 62 to 64.

The type of employment also made a difference. Real median annual income declined to a similar degree for households headed by private-sector wage workers (4.3 percent) and government-sector workers (3.9 percent), but fell much more for the self-employed (12.3 percent).

Family households generally had larger declines in real income than other households. Men living alone showed a bigger decline than women living alone.

Education levels were also a factor. Median annual income declined most for households headed by someone with an associate’s degree, dropping 14 percent, to $53,195, in the four-year period that ended in June 2011, the report said.

For households headed by people who had not completed high school, median income declined by 7.9 percent, to $25,157. For those with a bachelor’s degree or more, income declined by 6.8 percent, to $82,846.

Article source: http://feeds.nytimes.com/click.phdo?i=bbe8245c5c3936f87941de68fd48cbd4

Filed Under: Economy News Tagged With: census bureau officials, unemployment benefits, unemployment rate

Some Unemployed Find Fault in Extension of Jobless Benefits

October 7, 2011 by NewsMaker Leave a Comment

“They’re going to end up spending more money on unemployment benefits, while less money is coming in on tax returns,” he said, suggesting that the government should focus on measures that might encourage businesses to hire. “Far better to relax some of these outrageous regulations.”

Make no mistake — Mr. Tolleson, 54, has collected unemployment checks, saying he had little choice. But his objection to a policy that would probably benefit him shows just how divisive the question has become of providing a bigger safety net to the long-term jobless, a common strategy in recessions.

President Obama wants to continue offering benefits for an extended period of time, a maximum of 99 weeks, as is now the case. The measure is part of his jobs bill, which he once again called on Congress to pass in a press conference on Thursday.

If the extension is not renewed, benefits for more than 2.2 million people will be curtailed by mid-February, according to the Department of Labor. The Obama administration estimates that with no extensions, a total of six million people will run out of benefits over the course of next year.

Unless job growth picks up sharply, many of those people will struggle to stay out of poverty. Unemployment benefits, which average $298 a week, help families and serve as economic stimulus because most of the money gets spent right away on basics. Liberal and many centrist economists say that the economy is too weak now to withstand the shock of a sharp drop in those payments.

Still, conservatives contend that extending benefits pulls money from other parts of the economy, discourages people from finding work and increases the unemployment rate. Some Republican politicians have gone so far as to suggest that people living on unemployment are simply lazy. Even President Obama’s pick for head of the Council of Economic Advisers, Alan B. Krueger, has acknowledged that increasing unemployment benefits prolongs unemployment, as conservatives were quick to point out when he was nominated in August.

To some taxpayers, unemployment extensions are just another big government expenditure that comes out of their pockets and goes into someone else’s. Some would rather see the money spent on projects with a return, like building highways and schools. Others prefer freeing businesses of expenses like the health care plan and new regulations.

Even among those struggling to find work, Mr. Tolleson is not alone in his views. In a recent survey of the unemployed by Rutgers University, more than one in four respondents was opposed to renewing the current extended unemployment benefits. Three out of five said recipients should be required to take training courses.

Mr. Tolleson, who lives in Houston and whose last good job was working for a group that aims to replace the income tax with a national sales tax, said he filed for unemployment after a church said it could not help him otherwise. But, he said, he knows the money is not free: “They either tax it from somebody who’s making money or they’re going to print it — either way, the economy goes down.”

Theresa Gorski, a pharmaceutical sales rep in Detroit before losing her job 17 months ago, once shared his skepticism of prolonging unemployment benefits.

“If you would have asked me five years ago, I would have said no, because I always considered myself a Republican,” said Ms. Gorski, 50. “But now being in this position, with a college education and lots of work experience behind me, I find myself swinging more liberal, and more Democrat. And that would never have happened before.”

This recession has left more people unemployed for longer than ever before. In September, nearly seven million people were receiving unemployment benefits, and the Census Bureau says the payments lifted more than three million people out of poverty last year. Keeping the extensions in place for another year would cost $49 billion, the White House estimates.

Article source: http://feeds.nytimes.com/click.phdo?i=77d2899d9d81920a377efefb5f814884

Filed Under: Business News Tagged With: mistake, republican politicians, unemployment benefits

Consumer Inflation Higher Than Expected

September 15, 2011 by NewsMaker Leave a Comment

WASHINGTON — The inflation rate in the United States decelerated slightly in August as gasoline prices rose at a more modest pace and the cost of buying a new car held flat, the Labor Department said on Thursday. But rate was still higher than analysts’ forecasts.

At the same time, the department said the number of Americans filing new claims for jobless benefits rose unexpectedly last week in a sign concerns about a weak economy were sapping an already beleaguered labor market.

The Labor Department said its Consumer Price Index increased 0.4 percent last month, after rising 0.5 percent in July. The reading was higher than the 0.2 percent rise expected, with food prices posting their biggest gain since March.

Gasoline prices climbed 1.9 percent after jumping 4.7 percent the prior month. Food prices rose 0.5 percent after increasing 0.4 percent in July.

Core C.P.I. — which excludes food and energy — rose 0.2 percent after rising at the same rate in July. Last month’s gain was in line with economists’ expectations.

In the 12 months that ended in August, core C.P.I. increased 2.0 percent — the biggest rise since November 2008. This measure has rebounded from a record low of 0.6 percent in October 2010.

Overall consumer prices rose 3.8 percent year-over-year, the most since September 2008.

Applications for unemployment benefits climbed to 428,000 in the week ended Sept. 10 from an upwardly revised 417,000 the prior week, the Labor Department said.

It was the second straight week in which claims rose. Wall Street analysts had been looking for a dip to 410,000.

Excluding one week in early August, claims have held above 400,000 since early April. The four-week moving average of claims, which smoothes out volatility, rose to 419,500 from 415,500 the prior week.

Continuing claims eased to 3.726 million in the week ending Sept. 3 from 3.738 million the previous week. The number of total recipients on benefit rolls was 7.144 million.

U.S. employment growth ground to a halt in August, with zero net job creation raising fears of a new recession and putting pressure on the Federal Reserve to ease monetary policy further at 536870913 543782003

Article source: http://feeds.nytimes.com/click.phdo?i=28597a608b9aabed9bcc605d4766b5fd

Filed Under: Business News Tagged With: economists, unemployment benefits, wall street analysts

Economix: Is Deflation Back?

August 2, 2011 by NewsMaker Leave a Comment

Deflation has returned.

CATHERINE RAMPELL

Dollars to doughnuts.

For the first time in a year, consumer prices fell in June, according to a new report from the Commerce Department released Tuesday. The price decline was driven by energy declines, and is just one month’s data point, but even so, the figure is worrisome. The Federal Reserve pays close attention to this price index (more so, reportedly, than to the Consumer Price Index released by the Labor Department); and you may recall that part of the reason the Federal Reserve engaged in quantitative easing was the threat of a deflationary spiral.

Source: Bureau of Economic Analysis, via Haver Analytics

The Commerce Department’s report delivered other bad news, too.

Nominal personal income increased by just 0.1 percent in June — and the increase was due to higher government transfer payments (like unemployment benefits) and capital gains income, not wages and salaries.

In fact, private wage and salary income fell in June.

None of these facts bode well for growth in the third quarter of this year, given that the economy is so dependent on consumer spending. And the austerity measures created by the recent debt ceiling deal look unlikely to make things better.

Article source: http://feeds.nytimes.com/click.phdo?i=ed27f8f29ab1b0ede865c80037135df0

Filed Under: Economy News Tagged With: consumer price index, consumer spending, unemployment benefits

Hiring and Manufacturing Remain in a Summer Slump

July 22, 2011 by NewsMaker Leave a Comment

Layoffs are rising. Manufacturing activity in the Northeast expanded only slightly in July after contracting in June. Economic growth is projected to pick up this fall, but not enough to give businesses sufficient confidence to hire and speed the recovery.

Economists are forecasting a third straight month of feeble hiring in July, based on the latest round of data. Expectations are the economy added in the range of 50,000 to 100,000 net new jobs this month.

That is not enough to keep up with population growth and far below what is needed to lower the unemployment rate, which was 9.2 percent last month.

“We’re going to see improvement, but right now nothing’s improved yet,” said Joshua Dennerlein, an economist at Bank of America Merrill Lynch.

Applications for unemployment benefits rose last week to a seasonally adjusted 418,000, the Labor Department said. They have now topped 400,000 for 15 straight weeks. Applications had fallen in February to 375,000, a level that signals healthy job growth.

The Federal Reserve Bank of Philadelphia said its manufacturing index rose to 3.2 in July, a sign that the sector was growing again. It contracted in June for the first time in nine months. The index dropped to negative 7.7, the lowest level in two years. Any figure below zero indicates contraction.

The index topped 40 in March. The lower reading illustrates what analysts said was the impact of a parts shortage caused by the Japanese earthquake, which has affected many automakers and electronics producers. Still, manufacturers expressed some hope in the latest survey, saying they expect orders and shipments to pick up significantly six months from now.

The Conference Board projected modest growth for the broader economy in the coming months based on its latest reading of leading economic indicators. The index rose in June for the second straight month. It declined in April, the first time that had happened in nearly a year.

The private research group offered a caveat: Federal lawmakers must agree to raise the government’s borrowing limit and avoid a default on the debt.

The federal government has reached its borrowing limit of $14.3 trillion, and the Obama administration says the government will not be able to pay all its bills if the cap is not raised by Aug. 2.

Article source: http://feeds.nytimes.com/click.phdo?i=cb328e00385bf0639d88377351f49b3b

Filed Under: Economy News Tagged With: merrill lynch, nine months, unemployment benefits

As Costs Fall for Energy, Prices Drop for Producers

July 15, 2011 by NewsMaker Leave a Comment

The Bureau of Labor Statistics report showed that its index of wholesale prices fell 0.4 percent in June, after a rise of 0.2 percent in May. The decline last month was the steepest since February of last year and exceeded analysts’ forecasts of a 0.2 percent drop.

The 2.8 percent decrease in energy prices was the largest drop in that category since a 4.7 percent decrease in July 2009. Prices for gasoline, which had been rising in the first part of the year partly because of turmoil in Arab oil-producing countries, moved down 4.7 percent, the department said. The decline in energy prices more than offset the rise in food, which was up 0.6 percent in June.

When the volatile food and energy prices are extracted from the overall index, the core Producer Price Index rose 0.3 percent in June after a 0.2 percent increase in May, making it the seventh consecutive monthly rise.

The core index has risen 2.4 percent in the last year, the government report said.

That the core price index rose was “somewhat of a relief,” especially to the Federal Reserve, said Cliff Waldman, an economist for the Manufacturers Alliance. “It is a sign we have gotten out of the deflationary danger zone.”

The Federal Reserve chairman, Ben S. Bernanke, said on Wednesday that a renewed threat of deflation was one condition that could cause the central bank to resume its economic aid campaign, called quantitative easing.

The data on producer prices was one in a series of reports on Thursday that showed the state of the economy.

In the week ended July 9, the number of initial claims for unemployment benefits was 405,000, a decrease of 22,000 from the revised figure of 427,000 in the previous week, according to the Department of Labor.

Economists said that over all the decline in the weekly number was a positive sign, at least for one week.

But a better gauge, they said, is the four-week average, which also fell but remained above 400,000, a benchmark for job growth.

“The rule of thumb is that whenever you have the four-week moving average that goes under that number, that usually is a sign associated with payroll growth,” said Gregory Daco, the principal United States economist for IHS Global Insight.

So despite the most recent week’s decline, the current numbers are “still indicating some weakness in the unemployment market,” he said.

The Department of Commerce reported that retail sales in the United States rose 0.1 percent in June, after a decline of 0.1 percent in May. The increase was partly a result of a rise in auto prices.

“On the auto retail sales side of things, it seems that the supply chain disruptions emanating from the mid-March earthquake in Japan are probably easing,” said Chris G. Christopher Jr., the senior principal economist for IHS Global Insight, in a research note.

Over all, he said, the economy still has a number of pressure points. Unemployment rose to 9.2 percent in June, according to the latest government report. The stock market is volatile, consumer confidence is depressed and home prices are still scraping the bottom.

“Consumers are fatigued,” he wrote. “The only real good news on the consumer side of the economy is that gasoline prices started to fall, but are still relatively high.”

Article source: http://feeds.nytimes.com/click.phdo?i=1471cc65db9ac36ad2b52eeaf30246f9

Filed Under: Economy News Tagged With: producer price index, unemployment benefits, volatile food

Wholesale Prices Decreased in June

July 14, 2011 by NewsMaker Leave a Comment

Producer prices declined in the United States in June, dragged down by a fall in energy prices such as those for gasoline and electrical power, according to government statistics released Thursday.

The Bureau of Labor Statistics report showed that its index of wholesale prices fell 0.4 percent in June, following a rise of 0.2 percent in May. The decline last month was the steepest since February of last year and it exceeded analysts’ forecasts of a 0.2 percent drop.

The core index has risen 2.4 percent in the last year, the government report said.

The fact that the core price index rose was “somewhat of a relief,” especially to the Federal Reserve, said Cliff Waldman, an economist for the Manufacturers Alliance. “It is a sign we have gotten out of the deflationary danger zone.”

The data on producer prices was one in a series of reports on Thursday that showed the state of the economy.

Economists said that overall, the decline in the weekly number was a positive sign, at least for one week.

But a better gauge, they said, is the four-week average, which also fell but remained above 400,000, a benchmark for job growth.

So despite the most recent week’s decline, the current numbers are “still indicating some weakness in the unemployment market,” he said.

The Department of Commerce reported that retail sales in the United States rose 0.1 percent in June, after a decline of 0.1 percent in May. The increase was due partly to a rise in auto prices.

“Consumers are fatigued,” he wrote. “The only real good news on the consumer side of the economy is that gasoline prices started to fall, but are still relatively high.”

Article source: http://feeds.nytimes.com/click.phdo?i=1471cc65db9ac36ad2b52eeaf30246f9

Filed Under: Economy News Tagged With: initial claims, manufacturers alliance, unemployment benefits

Economix: Mr. Disability

May 20, 2011 by NewsMaker Leave a Comment

As we’ve noted here before, the federal disability program cost about $190 billion last year, in payments to disabled workers and health care for them. That’s the equivalent of roughly $1,500 in taxes for every American household.

Many are these workers are truly disabled. For others, though, disability has become a shadow program of long-term unemployment benefits, providing modest payments to people who probably can work and would do so if they could find a job with decent pay.

In The Wall Street Journal today, Damian Paletta has an article about a West Virginia administrative law judge who may provide the single best example of the system’s problems. Since the start of last year, the judge, David B. Daugherty, has heard more than 2,000 disability cases. He has awarded benefits in all but four of those cases, an approval rate of 99.8 percent.

No other judge in the country who hears remotely so many cases has an approval rate anywhere near as high.

Some of the most incredible details in Mr. Paletta’s story appear long after the front-page portion:

As Mr. Daugherty’s numbers rose, judges, staff and local attorneys began complaining about the volume of cases brought before the judge by one Kentucky lawyer.

The lawyer, Eric C. Conn, runs his Social Security practice out of a collection of connected mobile homes in Stanville, Ky., where he erected a giant statue of Abraham Lincoln in the parking lot. His smiling face adorns billboards up and down Highway 23, and his slogan is “he gets the job done.” Mr. Conn hired [Algernon] Tinsley, [a] former Huntington judge, and promotes him on local billboards, too. Mr. Conn often brings an inflatable replica of himself to events. His Web site address is mrsocialsecurity.com.

Judges and staff in the Huntington office have complained to supervisors that Mr. Daugherty assigns himself Mr. Conn’s cases, including some that were assigned to other judges, two former judges and several staff said. Cases are supposed to be assigned randomly.

According to a court schedule of Mr. Daugherty’s day reviewed by The Wall Street Journal dated Feb. 22, 2006, Mr. Daugherty held 20 hearings spaced 15 minutes apart for Mr. Conn and his clients in a Prestonsburg, Ky., field office. Such days can be a bonanza for lawyers: The average fee for one approval is between $3,000 and $3,500 and can go as high as $6,000.

Article source: http://feeds.nytimes.com/click.phdo?i=0613de0a9f07d2316861ad6b35d0c851

Filed Under: Economy News Tagged With: approval rate, eric c, unemployment benefits