The number of Americans filing for
unemployment benefits fell for the second straight week, a
government report showed, suggesting employers may be slowing the
pace of firings as the economy gains momentum.
First-time jobless claims fell to 381,000 in the week that
ended Saturday from a revised 400,000 the week before, the Labor
Department said in Washington. About half of the decline in new
claims may have been because of Hurricane Isabel, said Thomas
Stengle, a Labor Department spokesman.
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The economy is expected to grow this quarter at the fastest
rate since the first three months of 2002, and companies may be
holding on to workers as demand improves. Consumer and corporate
spending still must accelerate and earnings rise before hiring
picks up, some economists said.
“It’s good news because it’s the second week in a row we’ve
seen a decline, but we need to see a more definitive drop” in
claims, said Geoffrey Somes, senior economist at Fleet Bank in
Boston. “We can’t sustain high growth without the labor market
turning around.”
Hurricane Isabel, which swept through mid-Atlantic states
on Thursday and Friday, kept as many as 9,000 people from filing
last week, the Labor Department said.
Bill Sharp, a senior economist at J.P. Morgan Chase in New
York, projected that Hurricane Isabel reduced claims by between
5,000 and 10,000 last week. Isabel, the most powerful storm to
cross the Atlantic Ocean this year, knocked out power lines and
caused flooding in Maryland, North Carolina and Virginia.
Economists estimated that claims would rise to 400,000 from
the initially reported 399,000 the week before, based on the
median of 40 forecasts in a Bloomberg News survey.
The four-week moving average, a less volatile measure, fell
to 407,000 from 411,000.
“Initial claims remain stubbornly high relative to their
performance in prior cycles,” said William Dudley, chief U.S.
economist at Goldman, Sachs & Co., before the report. “Many more
steps are needed to make a giant leap.”
The number of people continuing to collect state unemployment
insurance fell by 28,000 to 3.63 million in the week that ended
Sept. 13.
The insured unemployment rate, which tends to move with the
monthly jobless rate, stayed at 2.9 percent in the week before
last. During that week 30 states and territories reported an
increase in new claims, and 21 reported a decrease. Two reported
no change.
Efficiency gains have allowed companies to do the same amount
of work with fewer employees. Productivity in the second quarter
expanded more than three times as fast as in the first, previous
government figures show.
Bloomberg News
