(By Mayur Pahilajani - iStockAnalyst Writer) Washington, D.C. - The number of individuals filing initial jobless claims for unemployment benefits increased more than expected last week, hitting the highest level in seven years, a report said on Thursday.
U.S. weekly initial jobless claims for insurance dropped for the first time by 32,000 to 516,000 on a seasonally adjusted basis in the week ended November 8, up from a revised 484,000 the prior week, according to the Labor Department.
The market analysts had expected the jobless claims to rise by only 4,000. The rise in the first-time jobless claims is a sign of the U.S. economy sinking deep into recession as it is already battered by higher inflation rate and weak consumer spending. The weekly first-time jobless claims have remained above 350,000-level since the month of April of 2008.
The Labor Department reported that the four-week average, which is a less volatile measure, of initial jobless claims increased by 13,250 to 491,000 in the last week, which is the highest since October 1991.
The four-week moving average was between 300,000 and 325,000 during most of 2007, which is a sign of healthy job growth; and it was below 350,000 for the first quarter in 2008.
According to the report, the number of continuing jobless claims increased by 65,000 to 3.897 million for the week ending November 1, which is the highest level since January 2003.
The four-week average of continuing unemployment claims also increased to 3.79 million, which is the most since 1983.
Last week, the Labor Department reported the number of nonfarm payrolls declined by 240,000 in October for a tenth-straight month and the sharpest drop since 2001 recession, compared to September's revised loss of 284,000 from 159,000. The unemployment rate for the month jumped to 6.5 percent.
The report also said that the unemployment rate increased by 0.4 percentage point, hitting 14-year high, from 6.1 percent reported in the month of September; while the unemployment rate has increased by 1.7 percentage points in the last 12 months.
Over the last ten months, the U.S. economy lost 1.2 million jobs as the companies cope with deepening financial subprime mortgage-related crisis and slumping credit market condition.
Today's jobs report showed the unemployment rate for workers with unemployment insurance, which tends to track the U.S. jobless rate, remained unchanged at 2.9 percent, up from last week's 2.8 percent. The information is delayed by one week.
The report also said there were 36 states and territories registered an increase in initial jobless claims, while 17 reported a decrease in the jobless claims for the November 1 week. These figures are also reported with a one-week delay.
The data showed Ohio registered the largest rise in initial jobless claims for the week of November 1 by 3,885 led by the automobile industry; While, California reported a largest decrease by 3,603 but no details were provided on the layoffs.
During the recession of 2001, around 415,000 individuals per week on average filed new applications for jobless benefits and insurance. In 2007, the economy created as much as 91,000 new jobs each month on average.
Source: http://www.dol.gov/opa/media/press/eta/ui/current.htm
