New jobless claims drop to lowest level in 25 years
Thursday, September 23rd 1999, 12:00 am
By: News On 6
WASHINGTON (AP) -- The number of Americans filing new claims for
unemployment benefits fell unexpectedly last week to the lowest
level in 25 years.
The Labor Department reported today that 272,000 Americans filed
new claims for jobless benefits for the week ending Sept. 18, down
by 17,000 from the previous week. That was the lowest level since
Jan. 5, 1974, when claims were at 269,000.
Government officials say part of the sharp drop could have been
because some unemployed who were affected by Hurricane Floyd were
unable to get to claims offices. But the officials had no specific
data on the storm's effects.
The four-week average for claims, which smoothes out
week-to-week volatility, also was down last week, to 285,750. That
was the lowest level since April 21 when claims were at 284,500.
Last week's decrease in new claims was unexpected. Many
economists had been forecasting a rise to 290,000.
Economists chalked up most of the big drop in claims as a fluke
related to the hurricane. "It's a temporary blip," said economist
Richard Yamarone of Argus Research Corp. "It is not indicative of
a worsening in the already tight labor market. It's unrelated to
true economic conditions."
He and other economists expect claims to increase in next week's
report, putting them more in line with the levels typically seen
over the last few months.
Still, economists consider jobless claims levels below 300,000
an indication of an extremely tight labor market. Last week was the
ninth week in a row that claims were below 300,000.
That's good news for workers but is potentially worrisome to
economists. Their fear: Employers scrambling for workers woo them
with higher wages and benefits, costs that may drive up prices.
On Wednesday, a Federal Reserve survey on business conditions
around the nation said there have been "few reports of
acceleration in nominal wages and salaries" even as companies find
it difficult to hire qualified workers for job openings in the
tight labor market.
The survey pointed out that some areas reported "a substantial
upswing in the cost of health-care benefits" while consumer prices
Financial markets have been on edge that the Federal Reserve
might raise interest rates for a third time this year in an effort
to slow economic growth and keep inflation in check.
The Labor Department said today that for the week ending Sept.
11, 42 states and territories reported decreases in new jobless
claim applications, while 10 reported increases. The state data lag
a week behind the national figures.
The state with the biggest decrease was California, down 4,359.
Officials offered no reason for the decline.
Other states with big decreases were: Missouri, down 2,615;
Kentucky, down 2,261; Illinois, down, 2,026; and Pennsylvania,
The state with the biggest increase was North Carolina, up 902.
Officials did not give a reason for the increase.
Other states with increases were: North Dakota, up 222;
Arkansas, up 167; Minnesota, up 95; and Vermont, up 91.