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New Jobless Claims Drop for Second Straight Week

Published June 03, 2010| Associated Press

WASHINGTON — New claims for unemployment insurance fell for the second straight week, fresh evidence the job market is slowly improving.

Still, the declines come after a sharp increase three weeks ago, and claims remain at elevated levels.

The Labor Department said Thursday that initial claims for jobless benefits dropped last week by 10,000 to a seasonally adjusted 453,000. That nearly matches analysts’ forecasts, according to a survey by Thomson Reuters.

Initial claims are closely watched by economists because they are considered a gauge of layoffs and a measure of companies’ willingness to hire new workers.

After falling steadily in the second half of last year, claims have leveled off and are now only slightly below the level they were at the beginning of this year. That’s raised concerns among some economists that hiring is still sluggish.

The four-week average, which smooths volatility, rose for the third straight week to 459,000.

That’s down by only 8,000 from its level in mid-January.

Employers are starting to ramp up hiring as the economy recovers from the worst recession since the 1930s, but not quickly enough to bring down the jobless rate. Unemployment rose to 9.9 percent in April from 9.7 percent the previous month, even as the economy generated 290,000 jobs. The rate rose partly because almost a million people began or resumed job searches that month, increasing the size of the labor force.

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