Thursday 6 August 2009

US Jobless Claims -38K To 550K In August 1 Week; Survey +1K

Thu, Aug 6 2009, 12:45 GMT

US Jobless Claims -38K To 550K In August 1 Week; Survey +1K
   By Sarah N. Lynch

WASHINGTON -(Dow Jones)- The number of U.S. workers filing new claims for state jobless benefits fell last week, providing another glimmer of hope that the economy may be on the road to recovery.

Initial claims for jobless benefits fell by 38,000 to 550,000 on a seasonally adjusted basis in the week ended Aug. 1, the Labor Department said in its weekly report Thursday. The four-week average of new claims, which aims to smooth volatility in the data, fell by 4,750 to 555,250, the lowest level since Jan. 24.

The tally of continuing claims -- those drawn by workers for more than one week -- rose by 69,000 during the week ended July 25 to 6,310,000, the highest level since July 4.

Economists surveyed by Dow Jones had predicted an increase in initial claims of only 1,000.

Analysts with both J.P. Morgan Chase & Co. and Barclay's Capital had predicted recently that claims for the week ending August 1 would start to edge downward. Both noted that claims are way down from their peaks in the spring, signaling some positive economic signs.

"Claims are still at a very high level, but the fact you're seeing a downturn in claims is an encouraging sign," said Barclay's Capital economist Michelle Meyer in a Wednesday interview with Dow Jones.

Thursday's numbers represented a return to normalcy following a volatile period in July which included two weeks of steep declines followed by two weeks of rebounds in the figures. The declines occurred after the usual layoffs in the automobile and other manufacturing sectors, which are expected this time of year, never panned out.

On Thursday, an analyst with the Labor Department called the latest data on jobless claims "fairly uneventful."

The unemployment rate for workers with unemployment insurance remained steady at 4.7%.

Still even with the numbers starting to look a little better, Meyer noted that "we are not out of the woods yet."

"We think we will see further job cuts, but a noticeable slowdown in the pace of cuts," she said.

-By Sarah N. Lynch, Dow Jones Newswires; 202-862-6634;

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(END) Dow Jones Newswires

August 06, 2009 08:45 ET (12:45 GMT)

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