Jobless Claims in U.S. Rose Less Than Forecast Last Week
Jobless claims rose by 1,000 to 308,000 in the week ended Sept. 28, from a revised 307,000, a Labor Department report showed today in Washington. The median forecast of 50 economists surveyed by Bloomberg called for a rise to 315,000. Continuing claims jumped as California worked through its backlog of applications following a change in computer systems.
The figures show business leaders remained confident enough in the economy to hold the line on firings even as gridlock in Washington pointed to an imminent partial closing of federal government agencies. Fewer dismissals lay the ground for bigger gains in payrolls and wages that will help sustain consumer spending, which accounts for about 70 percent of the economy.
“The claims data are flashing a much stronger signal” that other data such as payrolls, said Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc. in New York, the third-best claims forecaster over the past two years, according to data compiled by Bloomberg. “Companies are lean and mean, but the hiring that usually goes along with claims like these just isn’t happening.”
Stock-index futures held earlier losses after the report. The contract on the Standard & Poor’s 500 Index maturing in December fell 0.1 percent to 1,681.5 at 8:52 a.m. in New York.
While the claims data were released today, the first partial shutdown of the government in 17 years will probably delay tomorrow’s release of the Labor Department’s September payrolls report, which was projected to show employers added 182,000 workers last month, according to the Bloomberg survey median.
A Labor Department official reiterated today as the figures were released to the press that all operations and surveys other than the claims data are suspended during the lapse of appropriations.
The agency will not release the monthly jobs report if the federal government is closed, according to an Obama administration official earlier this week.
Any claims filed by furloughed federal workers will not show up in the figures in coming weeks, another Labor Department official said today. They will be tallied in a separate category and will not influence the headline reading.
Economists’ estimates in the Bloomberg survey ranged from claims of 300,000 to 335,000. The Labor Department revised the previous week’s figure to 307,000, from an initially reported 305,000.
The jobless claims report showed the four-week moving average, a less volatile measure than the weekly figures, dropped to 305,000 last week, the lowest level since May 2007.
The number of people continuing to receive jobless benefits jumped by 104,000 to 2.93 million in the week ended Sept. 21. The continuing claims figure does not include the number of Americans 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 121,500 to 1.47 million in the week ended Sept. 14.
The unemployment rate among people eligible for benefits rose to 2.3 percent in the week ended Sept. 21 from 2.2 percent.
Twenty-four states and territories reported an increase in claims, while 39 reported a decline. These data are reported with a one-week lag.
Initial jobless claims reflect weekly firings and typically wane before job growth can accelerate.
Figures released yesterday by the ADP Research Institute showed private employers added 166,000 workers in September following a revised 159,000 rise in August that was smaller than initially estimated. The median forecast of 40 economists surveyed by Bloomberg called for an advance of 180,000.
Retailers are announcing plans to add workers for the holiday shopping season. Wal-Mart Stores Inc. (WMT), the world’s largest retailer, is hiring 55,000 seasonal employees, a 10 percent rise from 2012. The company also will move 35,000 workers to full-time status from part-time, and another 35,000 to part-time from temporary.
Macy’s Inc. (M), the largest U.S. department store chain, plans 83,000 holiday hires, up from about 80,000 last year. Kohl’s Corp. (TGT) will take on about 53,000 workers for the holiday season, similar to last year.
While the number of federal workers who apply for jobless benefits will appear in a separate category, employees who are dismissed by government contractors as a result of the shutdown will show up.
United Technologies Corp., a supplier of helicopters and jet engines to the U.S. military, said an extended government shutdown would force furloughs of as many as 5,000 workers.
The first effect will be layoffs for about 2,000 Sikorsky Aircraft employees in Connecticut, Florida and Alabama on Oct. 7, United Technologies said yesterday. They may be followed by 2,000 furloughs at Pratt & Whitney and UTC Aerospace Systems if the shutdown lasts into next week, the company said.
The total “could exceed 5,000 employees if the government shutdown continues into next month,” United Technologies said in a statement. The Hartford, Connecticut-based company receives about 18 percent of its revenue from the government, Chief Financial Officer Gregory Hayes told analysts this week.
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