Weekly US jobless claims hit 9-month high of 379K
WASHINGTON (AP) — The number of people seeking U.S. unemployment benefits rose 10,000 last week to a seasonally adjusted 379,000, the highest since March. The increase may reflect volatility around the Thanksgiving holidays.
The Labor Department said Thursday that the less volatile four-week average jumped 13,250 to 343,250, the second straight increase.
Applications are a proxy for layoffs. Last month, they fell to nearly the lowest level in six years, as companies cut fewer jobs. But two weeks ago, they surged 64,000 to 369,000.
Economists dismissed that spike, saying it likely reflected a Thanksgiving holiday that fell later in the month. That can distort the government’s seasonal adjustments. But if the trend continues it would be a troubling sign of rising layoffs.
The number of people receiving benefits rose sharply. More than 4.4 million people received unemployment benefits in the week ended Nov. 30, the latest data available. That was 600,000 more than the previous week. Those figures aren’t adjusted for seasonal patterns.
Still, most other recent job market data has been positive and economists generally expect unemployment benefits applications will soon fall back.
“We are inclined to ignore the recent claims data,” said Joseph LaVorgna, an economist at Deutsche Bank. “We see little evidence to suggest that the labor market trend of the past few months has meaningfully changed.”
Hiring has been healthy for the past four months. The economy added an average of 204,000 jobs a month from August through November, a solid improvement from earlier in the year. The unemployment rate fell in November to a five-year low of 7 percent.
The unemployment rate remains above the historic averages of 5 percent to 6 percent that are associated with strong job markets.
Federal Reserve Chairman Ben Bernanke said Wednesday that he expects the robust job gains to continue. Americans are spending more and the economy is less restrained by higher taxes and government spending cuts, he said.
Those trends have “increased our confidence that the job market gains will continue,” Bernanke said at a press conference.
The Fed said Wednesday that it would scale back its monthly bond purchases to $75 billion from $85 billion. The purchases are intended to lower long-term interest rates and encourage more spending. The cut suggests that Fed policymakers think the job market and economy will continue to improve even with less help from the Fed.