Jobless claims rise to highest point since September 2005
The Labor Department reported Thursday that new applications filed for unemployment insurance jumped by a seasonally adjusted 38,000 to 407,000 for the week ending March 29. The increase left claims at their highest point since Sept. 17, 2005, following the blows of the devastating Gulf Coast hurricanes.
‘This report supports the view that the jobs market is deteriorating toward recessionary conditions,’ said T.J. Marta, a fixed-income strategist at RBC Capital Markets.
For the first time, Federal Reserve Chairman Ben Bernanke acknowledged on Wednesday the country could be heading toward a recession. Many other economists and the public believe it’s already there.
Employers cuts jobs in January and February, and economists are predicting more losses when the government releases the March employment report today.
The latest snapshot of labor activity was worse than economists had anticipated. They had predicted claims would be much lower, around 365,000.
A government analyst said some of the big increase in claims may have been related to an early Easter holiday this year, where claims that weren’t filed or processed during the holiday week were pushed forward into the following week.
Still, looking at the longer-term trend there was little doubt of the pickup in unemployment filings. A year ago, new claims stood at 319,000.
Meanwhile, the number of people continuing to collect unemployment benefits rose by a sharp 97,000 to 2.94 million for the week ending March 22, the most recent period for which that information is available. That was the highest since July 17, 2004.
The economy is suffering from three mighty blows ‘ a housing collapse, a credit crunch and a financial system in turmoil. That’s causing people and businesses to hunker down, crimping spending, capital investment and hiring. Those things in turn further weaken the economy in a vicious cycle.
Unemployment
glance
Nation: 4.8%
Tennessee: 5.3%
Warren County: 7.4%
Note: Williamson County has the lowest unemployment rate in the state at 3.9%, while Perry County has the highest at 11.6%