U.S. Unemployment Claims Remain Elevated

The Labor Department said on Wednesday that first-time applications for jobless benefits fell by 41,000 last week to a seasonally adjusted 410,000. That offset only part of the previous week’s surge.

Two weeks ago, the storm drove applications up by 90,000, to 451,000, an 18-month high. Nearly 44,000 people in New York and 31,000 in New Jersey applied for jobless benefits that week, according to the latest state data available. People in Pennsylvania and Connecticut also sought benefits because of the storm.

The four-week average of jobless claims, a less volatile measure, rose by 9,500, to 396,250.

Before the storm, weekly applications had fluctuated this year from 360,000 to 390,000. At the same time, employers added an average of nearly 157,000 jobs a month. That is barely enough to lower the unemployment rate, which was 7.9 percent in October.

The aftermath of the hurricane is also likely to slow job growth in November, economists said.

Joseph LaVorgna, an economist at Deutsche Bank, said that net job gains could fall to 25,000 this month from 171,000 in October. But employment should rebound after the impact of the hurricane passes. Rebuilding efforts after the storm could even create some jobs.

“If there is any good news in this extremely tragic event, it is that the longer-term impacts on the labor market in particular and the economy in general are negligible,” he said.

There are some signs that the job market is improving. Hiring picked up in October and was stronger than first estimated in August and September, the Labor Department said this month. The economy gained an average of 174,000 jobs a month in the July-to-September quarter. That is up from 67,000 a month in April through June.

The number of people receiving unemployment benefits increased by about 244,000, to 5.2 million, in the week that ended Nov. 3, the latest data available. That is up from fewer than five million the previous week.

Still, consumers are optimistic the unemployment rate will drop over the next 12 months, raising their confidence to the highest level in five years.

The University of Michigan said Wednesday that its consumer sentiment index ticked up to 82.7 this month from 82.6 in October. The index has increased 19 percentage points in the last year.

Optimism about the job market is high. Of those surveyed, 30 percent expect the unemployment rate will fall over the next 12 months. That matches October’s percentage and is the highest since 1984.

Separately, the Conference Board said on Wednesday that its index of leading indicators increased 0.2 percent in October after a 0.5 percent gain in September. The slight gain suggests growth could remain weak. The index is intended to anticipate economic conditions three to six months out.

Article source: http://www.nytimes.com/2012/11/22/business/economy/jobless-claims-decline.html?partner=rss&emc=rss