U.S. Initial Jobless Claims Rose by 1,000 to 351,000
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U.S. Initial Jobless Claims Rose by 1,000 to 351,000
July 1 (Bloomberg) -- The number of U.S. workers filing new claims for jobless benefits unexpectedly rose last week to 351,000, a level that economists said is still consistent with job growth.
State employment security offices received 1,000 more initial applications than in the prior week, the Labor Department said in Washington. The four-week moving average rose to 347,000 from 344,500.
Economists are still expecting steady growth in employment amid forecasts that the economy this year will expand the most in two decades. Payrolls increased by 1.2 million from January through May, the biggest five-month gain since 2000.
The level of claims ``is consistent with a continued strong labor market because we don't think claims can get much lower in a market of this size,'' Joshua Shapiro, chief U.S. economist at MFR Inc. in New York, said.
Economists had expected claims to fall last week to 342,000, which is the median of 40 forecasts in a Bloomberg News survey, from 349,000 initially reported for the previous week. Estimates for last week ranged from 335,000 to 360,000.
Claims have averaged 347,192 a week this year, compared with 402,000 in 2003. The Labor Department is expected to report tomorrow that 250,000 jobs were added in June, compared with 248,000 the month before, according to the median of 73 forecasts in a Bloomberg News survey.
The Federal Reserve yesterday raised the benchmark U.S. interest rate to 1.25 percent, the first increase since May 2000, from a 46-year low of 1 percent. The accompanying statement from the central bank's Federal Open Market Committee said ``labor market conditions have improved'' since the May 4 meeting.
Continuing Claims
The economy is forecast to expand 4.6 percent this year, the most since 1984, according to the median estimate of economists polled earlier this month.
The number of people continuing to collect state jobless benefits rose by 13,000 to 2.966 million in the week that ended June 19 from a revised 2.953 million a week earlier. The statistics are reported with a one-week lag to initial claims.
The four-week moving average for continuing claims fell to 2.919 million, the lowest since June 2001, from 2.924 million.
The insured unemployment rate, which tends to move with the jobless rate, rose to 2.4 percent in the week that ended June 19 from 2.3 percent the prior week. Thirty states and territories reported an increase in new claims, while 23 had a decrease.
Increases in commodity prices may have started to restrict the ability of some companies to expand workforces, economists including Robert Mellman at J.P. Morgan Securities Inc. in New York. More companies in the Chicago area reported paying higher prices for materials in June than at any time since 1988, a survey of purchasing executives showed yesterday.
Shedding Workers
``Increases in energy prices may be causing a bit of a cost squeeze,'' Mellman said. The rise in jobless claims ``has not been very sharp,'' he said.
Employers such as Lubrizol Corp. and Continental Tire are still looking for savings through consolidations and moving jobs to other countries.
Continental AG said this week it will suspend production at the Continental Tire plant in Mayfield, Kentucky, by the end of this year, idling 827 workers. Continental, based in Hanover, Germany, has been moving operations to Mexico, Romania and other countries with lower wages than in the U.S. and Germany. Continental is the world's fourth-largest tire maker.
Lubrizol Corp., the world's biggest maker of additives lubricants and fuels, said yesterday it will cut about 95 technical and commercial jobs as part of a restructuring. Most jobs will be eliminated at the Wickliffe, Ohio, headquarters. Companies such as Paychex Inc. that manage payroll services say the trend is still toward adding workers.
``Employers are really starting to hire a lot more new people and adding them to their payrolls,'' Thomas Golisano, chief executive of Paychex, based in Rochester, New York, said in an interview last week. The Rochester, New York, company manages payrolls and employee record-keeping for other companies.
State employment security offices received 1,000 more initial applications than in the prior week, the Labor Department said in Washington. The four-week moving average rose to 347,000 from 344,500.
Economists are still expecting steady growth in employment amid forecasts that the economy this year will expand the most in two decades. Payrolls increased by 1.2 million from January through May, the biggest five-month gain since 2000.
The level of claims ``is consistent with a continued strong labor market because we don't think claims can get much lower in a market of this size,'' Joshua Shapiro, chief U.S. economist at MFR Inc. in New York, said.
Economists had expected claims to fall last week to 342,000, which is the median of 40 forecasts in a Bloomberg News survey, from 349,000 initially reported for the previous week. Estimates for last week ranged from 335,000 to 360,000.
Claims have averaged 347,192 a week this year, compared with 402,000 in 2003. The Labor Department is expected to report tomorrow that 250,000 jobs were added in June, compared with 248,000 the month before, according to the median of 73 forecasts in a Bloomberg News survey.
The Federal Reserve yesterday raised the benchmark U.S. interest rate to 1.25 percent, the first increase since May 2000, from a 46-year low of 1 percent. The accompanying statement from the central bank's Federal Open Market Committee said ``labor market conditions have improved'' since the May 4 meeting.
Continuing Claims
The economy is forecast to expand 4.6 percent this year, the most since 1984, according to the median estimate of economists polled earlier this month.
The number of people continuing to collect state jobless benefits rose by 13,000 to 2.966 million in the week that ended June 19 from a revised 2.953 million a week earlier. The statistics are reported with a one-week lag to initial claims.
The four-week moving average for continuing claims fell to 2.919 million, the lowest since June 2001, from 2.924 million.
The insured unemployment rate, which tends to move with the jobless rate, rose to 2.4 percent in the week that ended June 19 from 2.3 percent the prior week. Thirty states and territories reported an increase in new claims, while 23 had a decrease.
Increases in commodity prices may have started to restrict the ability of some companies to expand workforces, economists including Robert Mellman at J.P. Morgan Securities Inc. in New York. More companies in the Chicago area reported paying higher prices for materials in June than at any time since 1988, a survey of purchasing executives showed yesterday.
Shedding Workers
``Increases in energy prices may be causing a bit of a cost squeeze,'' Mellman said. The rise in jobless claims ``has not been very sharp,'' he said.
Employers such as Lubrizol Corp. and Continental Tire are still looking for savings through consolidations and moving jobs to other countries.
Continental AG said this week it will suspend production at the Continental Tire plant in Mayfield, Kentucky, by the end of this year, idling 827 workers. Continental, based in Hanover, Germany, has been moving operations to Mexico, Romania and other countries with lower wages than in the U.S. and Germany. Continental is the world's fourth-largest tire maker.
Lubrizol Corp., the world's biggest maker of additives lubricants and fuels, said yesterday it will cut about 95 technical and commercial jobs as part of a restructuring. Most jobs will be eliminated at the Wickliffe, Ohio, headquarters. Companies such as Paychex Inc. that manage payroll services say the trend is still toward adding workers.
``Employers are really starting to hire a lot more new people and adding them to their payrolls,'' Thomas Golisano, chief executive of Paychex, based in Rochester, New York, said in an interview last week. The Rochester, New York, company manages payrolls and employee record-keeping for other companies.
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