Jobless Claims in U.S. Increase More Than Forecast

Samira Bhagvat

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More Americans than projected filed applications for unemployment benefits last week, bringing a halt to the recent progress in the labor market.

First-time jobless claims rose by 16,000 to 357,000 in the week ended March 23, the highest level in more than a month, Labor Department data showed today in Washington. The medianforecast of 48 economists surveyed by Bloomberg called for an increase to 340,000. The four-week average climbed from the lowest level in five years.

Consumer spending has continued to climb even after lawmakers agreed to let the payroll tax rise by 2 percentage points in January, giving employers reason to retain staff. At the same time, stronger economic growth is needed to further reduce the pace of firings, add to payrolls and boost wages.

“We’re not making progress the way we’d like to,” said Robert Brusca, president of Fact & Opinion Economics in New York, who projected claims would climb to 350,000. “It’s still a very disappointing picture for jobs.”

The economy grew at a faster pace than previously estimated in the fourth quarter, reflecting a bigger gain in business spending and a smaller trade gap, a report from the Commerce Department showed today. Gross domestic product rose at a 0.4 percent annual rate, up from a 0.1 percent prior estimate and following a 3.1 percent gain in the third quarter.

Shares Rise

Stock-index futures were little changed after the reports, erasing earlier gains. The contract on the Standard & Poor’s 500 Index rose less than 0.1 percent to 1,557 at 8:50 a.m. in New York.

Economists’ claims estimates in the Bloomberg survey ranged from 330,000 to 355,000 after an initially reported 336,000 in the prior period.

There was nothing unusual in last week’s data and no states’ figures were estimated, a Labor Department spokesman said as the report was released to the press. There were no comments linking last week’s jump in claims to the automatic federal government budget cuts that started taking effect this month, the official said.

With today’s release, the Labor Department issued its annual revisions reflecting tweaks in the way the claims data are adjusted for seasonal swings.

The less-volatile four-week moving average climbed to 343,000, up from 340,750, which was the lowest since 2008.

Continuing Claims

The number of people continuing to receive jobless benefits fell by 27,000 to 3.05 million in the week ended March 16, the fewest since June 2008. The continuing claims figure doesn’t include Americans receiving extended unemployment benefits under federal programs.

Those who have used up their traditional benefits and are collecting emergency and extended payments increased by about 125,500 to 1.91 million in the week ended March 9.
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