First-time claims for unemployment benefits increased roughly in line with economist estimates in the week ended April 18th, according to a report released by the Labor Department on Thursday, with the report also showing another record number of continuing claims.
The report showed that initial jobless claims rose to 640,000 from the previous week's revised figure of 613,000. Economists had expected jobless claims to rise to 639,000 from the 610,000 originally reported for the previous week.
With the increase, jobless claims moved back to the upside after showing a notable decline in the previous week that was likely influenced by the Easter holiday.
Peter Boockvar, equity strategist at Miller Tabak, noted, The Labor Department said there were no special factors in this week's data, thus for now at least making last week's drop an anomaly.
Nonetheless, the report also showed that the less volatile four-week moving average edged down to 646,750 from the previous week's unrevised average of 651,000.
As mentioned above, however, the Labor Department also said that continuing claims in the week ended April 11th rose to another new record high of 6.137 million from preceding week's revised level of 6.044 million.
Boockvar said that the continued increase in continuing claims highlights the difficulty people are having in finding new jobs even though the pace of firings has stabilized.
While much of the recent economic data has pointed to at least a slowdown in the pace of contraction in the economy, most of the recent employment data suggests continued weakness in the labor market.
Earlier this month, the Labor Department released a report showing a continued decrease in jobs in the month of March, with non-farm payroll employment falling by 663,000 jobs following an unrevised decrease of 651,000 jobs in February.
With the continued decrease in jobs, the unemployment rate rose to 8.5 percent in March from 8.1 percent in February, in line with expectations. The increase lifted the unemployment rate to its highest level since November of 1983.
The Labor Department noted that the job losses in March were large and widespread across the major industry sectors.
Although employment data is generally seen as a lagging indicator of the strength of the economy, the continued decrease in jobs can still negatively impact consumer confidence.
Subsequently, with people worried about losing their jobs less likely to make discretionary purchases, the perception of a weak labor market can still hurt consumer spending, which accounts for about two-thirds of economic activity.
For comments and feedback: contact firstname.lastname@example.org