U.S. Unemployment Claims Unexpectedly Fell Last Week
The number of Americans filing first-time claims for unemployment benefits unexpectedly fell last week to a two-month low, a sign some companies have put firing plans on hold.
Initial jobless claims decreased by 33,000 to 342,000 in the week ended April 19, the Labor Department said today in Washington. Economists surveyed by Bloomberg News had forecast a gain of 3,000. The number of people staying on benefit rolls declined to 2.934 million from close to a four-year high of 2.999 million the week earlier.
Businesses are trying to assess how deep the downturn may be before they fire additional workers, and some firms are retaining employees to fill a surge in export orders. Still, lower home values, higher fuel bills and fewer jobs make it more likely consumers will restrain their spending, which accounts for two-thirds of the economy.
“Businesses were very judicious in their hiring,'' Mickey Levy, chief economist with Bank of America Corp. in New York, said in an interview with Bloomberg Television. “In most industries you do not have employment out of whack. Businesses don't have to trim employment as much as in past recessions.''
Durable Goods Orders
Another government report showed orders for U.S. durable goods excluding transportation equipment rose more than forecast last month, indicating demand from overseas may be helping factories weather the housing-led economic slowdown.
Bookings rose 1.5 percent for such goods, outside of cars and planes, following a 2.1 percent decline for February, the Commerce Department said today in Washington. Total orders for durable goods, those meant to last several years, unexpectedly fell 0.3 percent, restrained by a decrease in demand for defense-related hardware.
Initial jobless claims were forecast to increase to 375,000 from 372,000 initially reported for the prior week, according to the median projection of 41 economists in a Bloomberg News survey. Estimates ranged from 360,000 to 385,000.
The four-week moving average, a less volatile measure, dropped to 369,500 from 376,750 free credit report online.
The unemployment rate among people eligible for benefits, which tends to track the U.S. jobless rate, stayed at 2.2 percent. These data are reported with a one-week lag.
Thirty-four states and territories reported an increase in new claims, while 19 reported a decrease, the report said.
Initial jobless claims reflect weekly firings and tend to rise as job growth — measured by the monthly payroll report — slows.
Initial jobless claims have averaged 352,600 so far this year, compared with an average of 321,000 a week in 2007, when the economy generated an average of 91,000 new jobs each month.
Payrolls Report
Employers cut 80,000 jobs in March, following declines of 76,000 in each of the prior two months, the most job cuts since 2003. Economists surveyed by Bloomberg forecast employers slashed 78,000 jobs in April, according to a survey before the May 2 report from the Labor Department.
Economists surveyed by Bloomberg in the first week of April forecast the economy won't show any growth in the first half of the year, the slowest pace since the last recession in 2001.
Financial services companies have accelerated the pace of firings as losses mounted in the wake of a surge in foreclosures and subprime mortgage defaults.
Wall Street banks and securities firms, hit by $290 billion in mortgage losses and writedowns, have slashed 48,000 jobs in the past 10 months, led by cuts at Citigroup Inc., Merrill Lynch & Co., Lehman Brothers Holdings Inc. and Bank of America Corp, according to the Securities Industry and Financial Markets Association.
Merrill Lynch & Co., the third biggest U.S. securities firm, said April 17 it would cut about 3,000 more jobs after the credit-market seizure forced the investment bank to write down about $6.5 billion of debt.
Filed under: money by Forest