Jobless claims across the United States jump unexpectedly to 16-year high
By CHRISTOPHER S. RUGABER - AP Economics Writer
Published: November 20, 2008
Paul Nawrocki, from Beacon, N.Y., wears a sign as he walks through Times Square seeking employment, New York, Tuesday Nov. 18, 2008. (AP Photo/Bebeto Matthews)
WASHINGTON -- New claims for unemployment benefits jumped last week to a 16-year high, the Labor Department said Thursday, providing more evidence of a rapidly weakening job market expected to get even worse next year.
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The government said new applications for jobless benefits rose to a seasonally adjusted 542,000 from a downwardly revised figure of 515,000 in the previous week. That's much higher than Wall Street economists' expectations of 505,000, according to a survey by Thomson Reuters.
That is also the highest level of claims since July 1992, when the U.S. economy was coming out of a recession, the department said.
The four-week average of claims, which smooths out fluctuations, was even worse: it rose to 506,500, the highest in more than 25 years.
In addition, the number of people continuing to claim unemployment insurance rose sharply for the third straight week to more than 4 million, the highest since December 1982, when the economy was in a painful recession.
Those figures partly reflect growth in the labor force, which has increased by about half since the early 1980s.
The figures likely will cause some economists to increase their projections for the unemployment rate this year. Many already expect unemployment to reach 7 percent by early next year and 8 percent by the end of 2009.
The rate in October was 6.5 percent, and last year the rate averaged 4.6 percent.
The Federal Reserve on Wednesday released projections that the jobless rate will climb to between 7.1 percent and 7.6 percent next year, according to documents from the Fed's Oct. 29 closed-door deliberations on interest rate policy.
Initial claims have been driven higher in the past several months by a slowing economy hit by the financial crisis, and cutbacks in consumer and business spending.
Economists consider jobless claims a timely, if volatile, indication of how rapidly companies are laying off workers. Employees who quit or are fired for cause are not eligible for benefits.
Several companies announced mass layoffs in the past week, including Citigroup Inc., Union Pacific Corp. and Sun Microsystems Inc.
Copyright 2008 The Associated Press.
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Michael, you are exactly right in what you say. But, you could have said more. The wild gambles that Republicans have let Investment banks, wall street securities firms and Insurance companies that concentrate on debt insurance make through derivatives and debt insurance with little or no backing collateral are what led to the value crash in home mortgages and the financial markets. Even before Bush came to office Republican Senator Phil Gramm finagled the elimination of a depression era law which limited the kind of financial excesses which have brought down the financial markets. after he became President, bush continued eliminating regulations which blocked Investment banks and other powers in the financial markets from making highly speculative, risky (and profitable) investments for which they didn't have adequate financial reserves.
Those are the things which led to the collapse of the financial markets, while Bush was doing everything you pointed out to eliminate the fiscal stability of our government.
Taken together, that's a double whammy from which it may take us years to recover. As you suggest, Republicans pointing fingers at Barney Franks are merely a pathetic attempy at CYA.
After eight years of trickle down voo doo economics from Bush, Cheney and gang this is what we get! The oil companies have more money in the bank then they have ever had and the rest of us suckers are gonna get to fight over the scraps. And to anyone who is blaming this mess on Obama or Barney Frank for that matter, you have got to stop watching Fox news and listening to Rush Limbaugh. This mess lies firmly at the feet of George Bush and his gang of war mongers. The reason our economy is in the tank is becuase we have been funneling Billions (thats with a B folks) of our dollars over to the middle east to fight a war based on a lie and in the process we made the entire region more unstable than it already was and we have had insanely high oil prices as a result. If we had not gone to war in Iraq, we would not be in the mess we are today plain and simple. This economic mess is a direct result of our failed policy in Iraq and the middle east.
Percy, I often agree with you. This time I don't. Before you start blaming Obama for anything, you need to let him be sworn in. He will have some responsibility for what happens after that point. It is true that, no matter what he does as President our economy won't right itself quickly. Regardless of the election, things are quite likely to get worse before they get better.
The most positive hope I can offer is that, just maybe, we will soon reach the bottom. Even if that wish should come true, our climb is likely to be slow and painful. That would be true no matter whom we chose as President. I ask you to consider one obvious fact. We are all in this together. We should all wish for Obama to have success. If he doesn't, we won't.
Tried to tell you more than once that electing Obama would make it Carter's second term. It was the Carter recession that Reagan brought us out of 25 years ago. So you went and elected Obama and look what happened! Don't try and blame this on Barney Frank or oil speculators or Bush. It's YOUR fault for not listening. Next time, let something "trickle through" instead of worrying about "trickle down."
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