JOBLESS claims continue to drop
Thursday, May 17th 2001, 12:00 am
By: News On 6
WASHINGTON (AP) _ New claims for state unemployment insurance dropped last week to the lowest level since March, the second straight week of decline.
The Labor Department reported Thursday that initial applications for jobless benefits fell by 8,000 to a seasonally adjusted 380,000 for the work week ending May 12.
The last time initial claims were this low was March 24, when claims were at 365,000.
In the week ending May 5, claims plunged by 37,000, according to revised figures. That was a smaller decrease than the government previously had estimated.
The more stable four-week moving average of jobless claims, which smoothes week-to-week volatility, declined to 401,250. That was the lowest point since April 21, when claims were at 395,250.
The new report follows the Federal Reserve's decision Tuesday to cut interest rates by one-half percentage point _ the fifth such cut this year. Economists say investors are growing increasingly optimistic that the economy and corporate earnings will turn around in the second half of 2001.
But they fear the rising unemployment rate could rattle Americans' confidence and cause a big cutback in consumer spending, which accounts for two-thirds of economic activity.
The unemployment rate jumped to 4.5 percent in April as businesses slashed payrolls by the largest amount in a decade, reflecting continued big layoffs in manufacturing.
For the work week ending May 5, 29 states and territories reported an increase in new jobless claims, and 24 reported decreases. The information lags a week behind national figures and is not seasonally adjusted.
The largest increases were in California, 6,939; Texas, 1,586; Puerto Rico, 1,351; Georgia, 910; and Pennsylvania, 827.
California's layoffs were in the service and motion picture industries, while Texas reported layoffs in a number of industries, including food, apparel, trade, service and machinery.
The largest decreases were in North Carolina, 12,265; Iowa, 3,598; New York, 3,232; Michigan, 2,145; and South Carolina, 1,575.
North Carolina had fewer layoffs in the textiles, furniture and apparel industries, while Michigan saw fewer layoffs in the automobile industry. South Carolina also had fewer layoffs in textiles.