Economy teeters on more jobs
WASHINGTON — The number of people applying for unemployment benefits barely rose last week, offering some hope that the job market may be improving. But claims need to fall further to bring down the 9.6 percent unemployment rate.
Initial claims for jobless aid increased by 2,000 to a seasonally adjusted 439,000, the Labor Department said Thursday. Still, claims have fallen below 440,000 in three of the past four weeks and remain near their lowest level in two years.
And the four-week average of claims, a less-volatile measure, fell for the fourth time in five weeks to 443,000. That’s the lowest level for the average since September 2008. The average has fallen by almost 20,000, or 4.2 percent, in the past five weeks.
The downward trend in both figures suggests companies are laying off fewer workers and some hiring is taking place — an encouraging sign for the economy. Still, most economists say claims need to drop below 425,000 to signal that hiring is really ramping up.
“The data on jobless claims continues to look encouraging as initial claims held at a relatively low level,” said Daniel Silver, an economist at JPMorgan Chase.
Two other reports supported an improving outlook for the economy.
The Conference Board, a private research group, said its index of leading economic indicators grew for the second straight month in October. It increased 0.5 percent last month, the same improvement as in September.
And Treasury prices fell after the release of a surprisingly strong report on manufacturing in the Philadelphia region.
The index, compiled by the Federal Reserve Bank of Philadelphia, rose to 22.5 this month. That was a big improvement from a reading of 1 in October. It was the highest reading since December 2009.
Readings greater than zero signal expansion in the region that covers Pennsylvania, part of New Jersey and Delaware. Demand for new orders and shipments rose. Factories boosted hiring and workers’ hours, the monthly survey says.
The weekly jobless claims figures provide a real-time snapshot of the job market. They closely track layoffs, which have dropped steadily in the past year, and indicate whether companies are hiring.
Claims have dropped by 16,000 in the past month. That indicates that the economy likely generated a net gain of jobs in November, similar to October’s gain of 151,000, economists said. But gains at that pace aren’t enough to rapidly bring down the jobless rate, which has been at 9.6 percent for three months.
The number of people continuing to claim unemployment aid fell by 48,000 to just under 4.3 million for the week ending Nov. 6, the department said. That doesn’t include millions of additional people on extended unemployment programs that were set up during the recession.
Overall, about 8.85 million people are receiving jobless aid, including 4.7 million that are doing so through the federally funded extended benefit programs. Those provide up to 99 weeks of benefits.
But the extended programs are set to expire at the end of this month. Up to 2 million people will lose benefits in December if the program isn’t extended, and another 2 million will run out this winter, the National Employment Law Project, a nonprofit group, estimates.
The House was scheduled to vote later yesterday on a bill that would extend the program for three months. But it isn’t clear if the bill will pass the House and Senate before Congress adjourns next month.