Initial jobless claims fall 9,000 to 363,000
Posted November 1, 2012 8:41 a.m. EDT
Updated November 1, 2012 9:16 a.m. EDT
New York — Fewer Americans than forecast filed first-time claims for unemployment insurance last week, an indication demand is strong enough to maintain current staff levels.
Applications for jobless benefits fell 9,000 to 363,000 in the week ended Oct. 27, the fewest in three weeks, the Labor Department reported today in Washington. Economists forecast 370,000 claims, according to the median estimate in a Bloomberg survey. Data for New Jersey and the District of Columbia were estimated because those offices were closed due to Hurricane Sandy, a spokesman said as the figures were released.
Fewer firings may mean companies are poised to boost hiring should the economy avert damage from the package of tax increases and spending cuts that will take effect next year if lawmakers fail to act. A Labor Department report tomorrow may show employers took on 125,000 workers in October, not enough to keep the jobless rate from rising to 7.9 percent from 7.8 percent, according to the Bloomberg survey median.
“Jobless claims have been trending down,” Michael Brown, an economist at Wells Fargo Securities LLC in Charlotte, North Carolina, said before the report. “We’re not seeing as many layoffs, but at the end of the day we’re not seeing a whole lot of hiring either.”
Estimates for first-time claims ranged from 355,000 to 380,000 in the Bloomberg survey of 49 economists. The Labor Department revised the prior week’s figures up from an initially reported 370,000.
Payroll provider ADP says businesses added 158,000 jobs in October.
ADP said it saw growth in construction, transportation and utilities, financial activities, and services. Manufacturing was the only sector that lost jobs.
ADP says the job gains accelerated from September, when revised figures showed a gain of 114,000 jobs.
ADP is calculating job gains with a different methodology than it had previously used. It had previously reported a gain of 201,000 jobs for September. The new report covers more businesses.
The report only covers hiring in the private sector, so it excludes government job growth.
The productivity of U.S. workers rose more than projected in the third quarter as companies wrung out more output from their employees in order to keep a lid on costs, another Labor Department report today showed. The measure of employee output per hour climbed at a 1.9 percent annual rate, the same as the prior quarter, and labor expenses unexpectedly dropped at a 0.1 percent pace.
A Labor Department official today said last week’s claims data had yet to be influenced by the fallout from Hurricane Sandy. If there was to be any impact it will show up in the next couple of weeks, the spokesman said.
The four-week moving average, a less-volatile measure, fell to 367,250 from 368,750.
The number of people continuing to collect jobless benefits rose by 4,000 to 3.26 million in the week ended Oct. 20. The continuing claims figure does not include the number of workers receiving extended benefits under federal programs.
Those who’ve used up their traditional benefits and are now collecting emergency and extended payments increased by about 47,000 to 2.13 million in the week ended Oct. 13.
The unemployment rate among people eligible for benefits held at 2.5 percent in the week ended Oct. 20. Twenty-three states and territories reported an increase in claims, while 30 reported a decrease.
Initial jobless claims reflect weekly firings and tend to fall as job growth -- measured by the monthly non-farm payrolls report -- accelerates.
Last month’s projected payroll gain would indicate the labor market has little momentum heading into 2013. Employment climbed by 146,000 a month on average in the third quarter.
Adding to the lot of unemployed Americans, EBay Inc., the world’s largest online marketplace, said Oct. 29 it will cut 325 jobs to improve efficiency. Newell Rubbermaid Inc., the maker of Sharpie pens and Calphalon cookware, said Oct. 26 it plans to cut 10 percent of its jobs in the next two-and-a-half years. The Atlanta-based company had 19,900 employees as of December.
Cuts in public spending are also hurting employment at government contractors, showing what could happen in the event the fiscal cliff materializes. Oshkosh Corp., the Wisconsin- based company that makes commercial trucks and supplies blast- resistant trucks to the U.S. Army and Marine Corps, said Oct. 26 it would cut 450 jobs in January due to lower demand from the Defense Department.
Rockwell Collins Inc. said it plans to cut 1,250 employees, or about 6 percent of its workforce, in the next year as the aerospace manufacturer’s defense revenue falls amid curtailed U.S. military spending.
(Bloomberg and The AP contributed to this report.)