Jobless claims retreat slightly
Thursday, April 19th 2001, 12:00 am
By: News On 6
WASHINGTON (AP) _ New claims for unemployment benefits retreated slightly last week after hitting a five-year high the previous week, the Labor Department said Thursday.
The number of newly laid-off workers filing for benefits totaled 385,000 last week, a decline of 10,000 from the week before _ right in line with analysts' expectations.
In the previous week, jobless claims rose by 11,000. That figure was revised slightly from the original estimate of 9,000 and pushed claims to 395,000, the highest level since 397,000 laid-off workers filed for benefits in the week of March 30, 1996.
Even with the improvement, the four-week moving average, which smoothes out week-to-week fluctuations, rose to 382,250, the highest level since the week of April 13, 1996.
On Wednesday, the Federal Reserve cut interest rates by one-half point, the fourth such reduction this year. It marked the second time the central bank has lowered rates outside of its regular meeting schedule this year, engineering its most aggressive credit easing since 1982.
Economists saw the Fed's latest rate cut, which caught Wall Street by surprise, as an effort to boost investor and consumer confidence that the economy will pull out of its current period of weakness.
The Fed's announcement had the initial desired effect, triggering a huge stock market rally with the Dow Jones industrial average soaring by 399 points, its third-biggest point gain in history.
Labor Department analysts said the Fed, as is customary, was given an advance look at the weekly jobless claims figures on Wednesday morning, 24 hours ahead of the release of the statistics to the public.
The Fed's decision to cut rates for a fourth time was made during a telephone conference call that began at 8:30 a.m. Wednesday.
The rising layoffs have already pushed unemployment up slightly in March to 4.3 percent, compared to the 30-year low of 3.9 percent reached during three months last year.
Analysts have begun to worry, with more companies reporting sales declines and earnings problems, that the slowdown could worsen into a full-blown recession unless the Fed's efforts to boost confidence begin to take hold.
For the week ending March 31, 49 states and territories had increases in jobless claims while three had declines and one reported no change. The state data are not adjusted for normal seasonal variations and lag behind the national data by one week.
For March 31, the biggest increases in claims were seen in Illinois, up 5,336, with the higher layoffs blamed on job cutbacks at auto plants and in the construction and service industries. Other states with big layoffs were North Carolina, up 5,067; Alabama, up 5,005, Pennsylvania, up 4,893; and Texas, with an increase in layoffs of 3,716.