Story URL: http://news.medill.northwestern.edu/chicago/news.aspx?id=221248
Story Retrieval Date: 7/26/2014 2:07:01 AM CST
U.S. Department of Labor
The number of Americans filing initial unemployment claims unexpectedly dropped last week -- to the lowest level in over five years -- according to a Thursday government report that added to a recent string of positive economic news.
For the week ended May 4, the U.S. Department of Labor said, a seasonally adjusted 323,000 claims were filed. That’s down 4,000 from the revised 327,000 in the previous week; economists surveyed by Bloomberg had been expecting initial claims to rise slightly, to 335,000.
“I think that’s a good indication” that the job market is improving, Trent Jackson, director of research at Chicago recruiting agency Jobplex, said in an interview.
“A number of sectors are picking up,” he said.
The latest report on jobless claims comes on the heels of Friday’s unemployment rate report, that showed a solid increase in new jobs created, and a dip in the nation’s unemployment rate to 7.5 percent from 7.6 percent.
“Overall, today's report validates the signal from last week's payroll report that the jobs market has remained resilient in the second quarter,” Michael Feroli, chief economist at JP Morgan Chase Bank NA, stated in an online commentary.
Initial claims, which measure the number of people who recently lost their jobs, are less detailed than the monthly employment report, but they are timelier, providing a near-term glimpse into the overall health of the economy.
Continuous claims, those from people who have filed for unemployment for a second consecutive week or more, declined 27,000 to a seasonally adjusted 3.01 million, a five-year low as well.
To offset the fluctuations of the weekly report, the Labor Department provides a four-week moving average. Thursday’s report showed a moving average of 336,750 down 10.5 percent from the previous year.
Despite the good news, economists are not ready to declare a boom. Some economists, such as Josh Nye of RBC Economics, are concerned about the effect of government spending cuts.
“We continue to expect the pace of employment growth will moderate in the near term from the 208,000 average increase seen during the six months ended April 2013, as the effect of government expenditure cuts continues to weigh on hiring,” he said in an interview.
In addition, Jobplex’s Jackson sees a huge unemployment rate among recent graduates. Among employers, “There is a huge push for experience,” he said.
Jackson advises recent college grads to obtain internships, and lists the industries of technology and health care as the biggest growth areas of the future.
Overall, however, Jackson noted, “People are optimistic.”