A SIGN THE WORST IS OVER?
May 07, 2009
(WASHINGTON, DC) -- Is it a sign the worst is over? New applications for jobless benefits across the nation plunged to the lowest level in 14 weeks, perhaps a possible sign that the national wave of job layoffs has peaked or is near a peak.
New York man walks through Timnes Square last November with sign saying he seeks work. CLICK TO ENLARGE
The Labor Department reported today the number newly laid off workers applying for benefits dropped to 601,000 last week when economists had expected around 635,000 claims.
A one-month moving average of initial jobless claims – thought to smooth out volatility in the numbers - totaled 623,500 last week, a decrease of more than 30,000 from the high in early April.
In general some economists say a drop of 30,000 to 40,000 in the four-week average is needed to signal a peak in jobless benefit claims.
In another report the government said worker productivity, the key ingredient to rising living standards, grew at a 0.8 percent annual rate in the January-March quarter, slightly better than the 0.6 percent increase that economists had expected.
However the number of unemployed workers getting benefits at present climbed to a new record.
The high level of continuing claims is a sign that many laid-off workers are having difficulty finding work. More than 5 million jobs have vanished in the recession, and Federal Reserve Chairman Ben Bernanke Tuesday predicted "further sizable job losses" in the coming months.
The rise in continuing claims to 6.35 million - registered for the week ending April 25, the latest data available – was up from 6.3 million in the previous week. It marked the highest count on record gong back to 1967.
The high level of continuing claims is a sign that many laid-off workers are having difficulty finding work.