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Initial unemployment claims stuck around 400,000

by and Maureen LaForge
Oct 06, 2011

New applications for unemployment benefits inched up last week, according to a  government report issued Thursday. . as cutbacks in military personnel and government jobs continue to swell the ranks of the jobless.

For the week ending Oct. 1, 401,000 Americans filed for first-time benefits, the U.S  Labor Department said.  That was a modest upturn from the prior week’s 395,000 new claims, which was the lowest number in nearly six months.

The latest week’s claims rate was slightly better performance than the abpout 410,000 new claims  economists had been expecting  but it offered little evidence to suggest a  a turnaround in the job market might be underway.
For the week ending Oct. 1, 401,000 Americans filed for first-time benefits.  In the prior week 395,000 submitted new claims, which was the least since April 2011.
Because layoffs  fluctuate significantly from week to week, most experts prefer to track the four-week rolling average of new claims, because the longer-term reading tends to smooth out volatility. The latest four-week rolling average for new unemployment claims fell 4,000 to 414,000.
For some time, new claims  have been hovering around 400,000, which is considered to be a kind of key threshold for interpreting the amount of new applications. Economists say the number of new claims would have to be parked well below 400,000 for a substantial period before they’ll conclude that the job market is on an upswing.

Illinois,  along with Michigan, Ohio and Alabama, reported the highest number of new claims last week, “which showed some softness in manufacturing employment and anecdotal reports of more financial sector layoffs,” said Diane Swonk, chief economist at Mesirow Financial.
Recent layoffs in the military account for the bulging numbers as well. “The wild card remains government jobs, which are shrinking at all levels,” Swonk said.

The new-claims report was issued just a day before the government releases its closely watched September jobs report.  Most experts are expecting the economy to generate about 65,000 new jobs for the month. .

The unemployment rate nationwide, has largely stalled over the past year. r. The national rate stands at 9.1 percent; and for Illinois it’s 9.9 percent.