Jobless claims dip, but more stable four-week average highest in nearly 10 years
Thursday, October 11th 2001, 12:00 am
By: News On 6
WASHINGTON (AP) _ New claims for unemployment benefits took a sharp dip last week but still remained at a high level reflecting fallout from the ailing economy and last month's terrorist attacks.
The Labor Department reported Thursday that for the work week ending Oct. 6, new jobless claims fell by a seasonally adjusted 67,000 to 468,000, a level suggestive of a weak jobs market, economists say.
The decline followed a big increase of 79,000 in the week prior and a 63,000 gain the week before that. Those advances, which had pushed claims to a nine-year high, largely reflected layoffs in the travel and tourism industries, which have been dealt a severe blow by the hijackings.
A government analyst cautioned not to read too much into last week's decline and suggested that seasonal adjustment was a factor in the drop. The analyst pointed out that unadjusted claims rose by 26,130 last week.
Private analysts tend to look at the four-week moving average of jobless claims, which smoothes out week-to-week fluctuations as a better barometer of layoffs. The more stable four-week moving average rose last week to 463,000, the highest level since Dec. 14, 1991, when the country was mired in its last recession.
More than 200,00 layoffs have been announced since the Sept. 11 attacks on the World Trade Center and the Pentagon, according to information compiled by private outplacement firm Challenger, Gray & Christmas.
Before the attacks, the labor market was already suffering because of the country's more than yearlong economic slump. Now, economists believe the jobless picture will get worse in the coming months.
Many economists believe the nation's unemployment rate, which held steady at 4.9 percent in September, could jump to 5.3 percent in October as the damage from the attacks show up in monthly labor statistics.
Last week the government reported that 190,000 jobs were eliminated in September alone, the largest one-month decline since payroll jobs fell by 259,000 in February 1991, when the country was in the depths of the last recession.
Manufacturing jobs again accounted for much of the loss. Factories let go 93,000 workers last month, the 14th straight month of manufacturing job losses. Over that period, 1.1 million workers lost their jobs.
With new uncertainties raised by the attacks, many economists believe a recession this year is unavoidable.
In an effort to stabilize the economy, the Federal Reserve has cut a key cut interest rates nine times this year, pushing it to the lowest point in nearly 40 years.
President Bush and Congress, meanwhile, are trying to work out a plan to jump-start the economy. The Bush administration is interested in a number of things, including extending unemployment benefits and providing help for low- and moderate-income workers, perhaps in the form of a new round of tax rebate checks.
For the work week ending Sept. 29, 11 states and territories reported a decrease in claims and 40 reported an increase. The state information lags a week behind the national figures and is not seasonally adjusted.
Florida reported the biggest jump in claims by 7,631 because of layoffs in manufacturing, service, trade, construction and agriculture. North Carolina saw the second-biggest increase in claims, up by 4,672, as workers in the textile and transportation industries were laid off. Claims went up by 4,418 in California, reflecting layoffs in the trade, service and electronics industries, which posted the third-biggest rise in jobless benefit applications last week.
In New York, claims rose by 2,052 as workers in the trade and service industries were laid off. The government said 6,600 layoffs have been reported to be directly related to the World Trade Center disaster.
And, in Virginia, where the Pentagon is located, layoffs from the airline and related industries pushed claims up by 2,583 last week. Approximately, 4,200 layoffs have been attributed to the attack.