jobs market

Weekly Jobless Claims Fall Again

The jobs market continues to show signs it is turning around as weekly claims fell again last week. Initial claims for unemployment dropped 12,000 to 367,000 according to the Labor Department. The week before saw claims revised slightly higher to 379,000 from 377,000. Jobless claims have held below 400,000 for 8 of the last 10 weeks, below a level typically used as a sign of an improving jobs market.

Economists were expecting a very slight drop to 375,000 last week. The four week moving average for jobless claims, which is used to smooth out volatility, fell to 375,750.

The jobs market has seen momentum in the past few months with the unemployment rate dropping to 8.5% in December. One thing to remember though is that when someone stops looking for a job because they have been unemployed for so long they are no longer counted.

The jobs market has a long way to go though as 23.7 million Americans are either unemployed or underemployed. Last week, the Federal Reserve acknowledged the improvement in the jobs market, but said the jobless rate is still too high. They will likely keep overnight lending rates near zero through at least 2014.

Productivity saw an increase, but was lower than expected. It increased at an annual rate of 0.7%, economists were expecting it to grow at 0.8%.

The Dow is trading flat right now despite the positive news from the jobs market. The Dow is up 8 points right now, the Nasdaq is up 13 points and the S&P 500 is up 3 points.

Weekly Jobless Claims Come In At 352,000, Lowest In 4 Years

Workers seeking unemployment benefits fell to a near four year low last week at 352,000. This is even more evidence that the jobs market is showing strength. The Labor Department said weekly unemployment applications fell 50,000 last week and is the biggest such drop in over six years. The four week average of unemployment claims, which helps gives a better look at the overall jobs market fell to 379,000. This is the lowest it has been in over three years.

A spokesman for the Labor Department did caution however that volatile swings in jobs numbers are common this time of year. Just a few weeks ago we saw applications jump to nearly 400,000 as companies laid off holiday workers. Any number below 375,000 is typically a signal that hiring is enough to lower the unemployment rate.

Some analysts agreed with the Labor Departments warning of seasonal volatility, but also saw the numbers as a positive. Omer Esiner, chief market analyst at Commonwealth Foreign Exchage, commented, “We have to see if there are some seasonality issues involved here, but on the surface this number looks to be very positive and is pretty much consistent with other data we’ve seen recently that suggest improvement in underlying fundamentals in the U.S.”

This news along with other factors is pushing the market slightly higher in midday trading. The Dow is up 24 points, the Nasdaq is up 19 points and the S&P is up 5 points.

Americans Feeling Better About The Economy As Consumer Sentiment Rises

Consumer sentiment rose last month and hit the highest levels in eight months according to the Thomson Reuters/University of Michigan’s consumer sentiment index. Americans are feeling better about the jobs market after the jobs market started turning around in December. 34% of consumers said they had heard about recent jobs gains, up from December’s 21%. It appears these numbers do not take into account the most recent jobs report that saw jobless claims increase to nearly 400k.

The Thomson Reuters/University of Michigan’s preliminary reading on consumer index rose to 74.0 from 69.9 in December, rising for the fifth straight month. The 74.0 reading beat estimates of 71.5 by economists polled by Reuters.

“More frequent mentions of rising employment lessened income uncertainty and prompted more favorable buying attitudes as well,” survey director Richard Curtin said in a statement.
“The data suggest a stronger consumer spending outlook, rising to about a 2.1 percent gain in 2012.” The reading for current economic conditions rose to 82.6 from 79.6, while consumer expectations jumped to 68.4 from 63.6.

Consumers still feel uneasy about government economic policies with the majority rating these policies as unfavorable for the sixth straight month. They also didn’t feel their personal finances will rise with only 24% expecting their finances to increase in January.

The stock market is largely ignoring this news today as JP Morgan’s 23% dip in profits and continued uncertainty in Europe takes center stage.

Jobs Market Hits Wall Again

More Americans filed for unemployment benefits than in previous weeks last week. 399,000 filed for unemployment claims, up from 375,000 the previous week and the highest in six weeks. This increase usually happens every year as companies let go of thousands of workers following the holiday sales season.

The Labor Department tries to take this into account, but usually can’t due to volatile data. The four-week average also jumped to 381,750. In the previous week that average hit a more than three year low. New unemployment claims below 375,000 typically reduce the unemployment rate as we saw in December when the rate fell to 8.5%. Last year the economy added about 1.6 million jobs, a 50% increase from 2009. According to a survey by the AP, economists are expecting the economy to add 1.9 million jobs this year.

Despite looking a little better in previous weeks, the jobs market has a long road to recovery. The recession in 2008 wiped out 8.7 million jobs and there are around 13 million unemployed people in the U.S. That doesn’t even count the millions who gave up looking for a job.

Plus, we have to take into account the state of the global economy which is shaky at best right now. The continued debt crisis in Europe and the inaction by euro countries to fix it is threatening to drag the entire world economy back into recession. Many economist believe that U.S. economic growth will suffer in the first half of this year as they see a recession in Europe as a foregone conclusion.

Weekly Jobless Claims Drop to 3 Year Low

New claims for unemployment benefits dropped to a 3 year low last week according to a government report today. This could mean the jobs market is recovering faster than expected. The Labor Department said claims for state unemployment benefits dropped 19,000 to 366,000.

The prior week’s claims data was revised up to 385,000 from the initially reported 381,000. It will be interesting to see if this fresh data will also be revised up and if so, how much. Most economists had expected a forecast of 390,000 new jobless claims. This drop pushes jobless claims closer to 350,000, which many believe is a sign of labor market strength.

The positive news from the jobs market shows that the U.S. economy is beginning to turn around. Earlier this week, The Federal Reserve acknowledged the improving jobs market but said unemployment remains high.

Economists are keeping a very close eye on the debt crisis in Europe as any further problems could affect the U.S. economy.

The four-week moving average of claims, a more accurate measure of labor market trends, fell to a three year low of 387,750. 3.6 million people are receiving benefits under state programs after one week of aid.

Overall, the jobs market is beginning to look better. There are still millions of people unemployed, but any drop in jobless claims is good news for them.

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