Initial Jobless Claims Dip in Latest Jobs Report
The weekly Jobs Report from the Labor Department issued this morning showed the number of initial jobless claims at its lowest level in two months. For the week ending September 4th, according to the report, there were 451,000 Americans who filed for unemployment insurance, down 27,000 from the revised total of 478,000 for the previous week. It’s the smallest number of Americans filing jobless claims since the week ending July 10th when there were 427,000 claims. The latest figures represented a better than expected downward trend, as economists had expected 470,000 claims for the week.
Analysts say that the new report represents hope for the countless unemployed Americans who are searching for work, as the downward trend means the economy is taking steps toward an environment that can produce job growth, though there is still plenty of work to do. The 4-week moving average of initial jobless claims, which is supposed to smooth out volatility in the job sector, came in at 477,500, down nearly 10,000 from the previous week’s revised 4-week average.
Many economists say that jobless claims should be between 400,000 and 450,000 to represent an environment that stimulates job growth. So the new reading of 451,000, while not within those parameters, is still way better than the averages in the mid 600,000s we were seeing during the worst part of the recession. Moving forward, economists predict initial claims to hover around these levels and that a significant drop won’t occur until more jobs are created and the overall economy can enjoy a sustained period of recovery.
The number of unemployed Americans filing unemployment claims for a second week or more also fell, to 4,478,000, for the week ending August 28th, the most recent data available for continuing claims. The number is down about 2,000 from the previous week’s numbers. Economists had expected that number to drop to 4,445,000, but were still positive about the number. The 4-week moving average for continuing claims fell slightly to 4,488,000, from the previous weeks’ average of just over 4,490,000.
The state that experienced the biggest drop in initial claims was California for the week ending August 28th, which is the latest data available for individual states. Claims in California dropped by just over 4,100, which officials attribute to fewer than expected layoffs in the manufacturing, construction, and trade industries. There was only one other state that saw claims dip by more than 1,000. Claims rose by more than 1,000, meanwhile, in three states. New York state led the was with a gain of 4,891 initial jobless claims, followed by Florida, with 1,886 and Nevada, where initial claims rose by 1,052.
President Obama, in the wake of the end of combat operations in Iraq, has turned his attention to the economy, especially the creation of jobs to help the economy gain a stronger foothold in recovery. He unveiled a new $50 billion plan earlier this week that will create jobs by improving roadways, railways, and airport runways across the country. The President is also urging Congress to pass a bill he proposed earlier this summer that would offer tax incentives to small businesses for creating jobs. A form of the bill was passed in the House in June but Senate Republicans have failed to pass the measure, scoffing at the $30 billion price tag.