Bumpy recovery: Jobless claims rise 18K but continued unemployment claims lowest since Dec. 2008
Thursday, April 8th 2010, 8:20 AM
The number of U.S. workers filing new claims for unemployment insurance rose unexpectedly last week, reflecting volatility in the data associated with the Easter holidays, while those on continued benefits was the lowest since December 2008.
However, continued claims fell and the report on Thursday is unlikely to change views a labor market recovery is underway though.
Initial claims for state unemployment benefits rose 18,000 to a seasonally adjusted 460,000, the Labor Department said. Analysts polled by Reuters expected claims to edge down to 435,000 from a previously reported 439,000 the prior week.
A Labor Department official attributed the rise in claims to seasonal volatility, mainly from the Easter holiday, and noted there were shutdowns in two states. A holiday on March 31 in California also had an effect on claims, he said.
The four-week moving average of new claims, which irons out week-to-week volatility, rose 2,250 to 450,250 last week.
U.S. stock index futures extended losses after the report, while government debt prices edged higher.
"The labor market is improving but it still has a ways to go. There is underlying strength emerging. People realize that Easter has distorted the data," said John Canally, economist at LPL Financial in Boston.
The U.S. labor market is in the early stages of recovery after losing more than 8 million jobs during the worst U.S. economic downturn since the 1930s in 2008-2009. A government report last week showed employers, led by the private sector, added 162,000 jobs in March -- the largest monthly gain in three years.
Jobs have been viewed as the missing link in the economic revival that started in the second half of 2009 and signs of healing will boost confidence in strength of the recovery and ensure it's durability.
While companies have resumed hiring, the pace remains too slow to make a huge impact on the 8.2 million people who lost their jobs since the recession struck in December 2007.
The number of people still receiving benefits after an initial week of aid fell 131,000 to 4.55 million in the week ended March 27, the lowest level since December 2008, the Labor Department said. Analysts had expected so-called continuing claims to dip to 4.65 million.
The insured unemployment rate, which measures the percentage of the insured labor force that is jobless, slipped to 3.5 percent, the lowest since January 2009, from 3.6 percent in the prior week.
(Reporting by Lucia Mutikani)
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