Ahead of the Bell: Jobless claims

SymbolPriceChangeYHOO16.450.00Chart for Yahoo! Inc.{“s” : “yhoo”,”k” : “a00,a50,b00,b60,c10,g00,h00,l10,p20,t10,v00″,”o” : “”,”j” : “”}

Applications for unemployment benefits likely didn’t change much last week, as hiring remains slow even as the economy shows signs of picking up.

Weekly jobless claims are forecast to tick down by 1,000 to a seasonally adjusted 420,000, according to a survey of economists by Thomson Reuters. While small, that would be the third drop in four weeks.

The Labor Department is scheduled to release the report at 8:30 a.m.

Claims have been steadily declining in the past two months, raising hopes among economists that layoffs are falling and employers are hiring more workers.

The four-week average of claims, which reduces the volatility in the weekly numbers, dropped last week to 427,500, the lowest level in more than two years. That’s about 30,000 lower than it was in early October.

First-time jobless claims at around 425,000 signal modest job growth. But economists say applications need to dip consistently to 375,000 or below to indicate a significant decline in unemployment. Applications for unemployment aid peaked during the recession at 651,000 in March 2009.

The weekly claims are a real-time snapshot of the job market. If claims continue to move down, hiring is more likely to pick up. Claims reflect the level of layoffs but can also indicate whether companies are willing to add workers.

Recent reports suggest the economic recovery is picking up steam. Factories are producing more, retail sales are rising, and business executives and consumers are increasingly optimistic.

But hiring hasn’t yet picked up. Earlier this month, the government issued a disappointing jobs report that showed employers added only 39,000 net new jobs in November, a sharp drop from the previous month. The unemployment rate rose to 9.8 percent from 9.6 percent.

Some companies are still cutting jobs. Yahoo Inc. said Tuesday that it is laying off 600 employees, or 4 percent of its work force.

GD Star Rating
Posted in Finance and tagged , , , , , .

Leave a Reply

Your email address will not be published. Required fields are marked *