Jobless claimsThis time in August is called the dog days, but as far as the U.S. job market is concerned, it's more like the bear days. Initial jobless claims unexpectedly rose by 12,000 to 500,000 last week -- their highest level since November 2009 -- the U.S. Labor Department announced Thursday.

A Bloomberg survey had expected initial jobless claims to fall to 480,000 from the previous week's revised total of 488,000.

In addition, the four-week moving average rose by 8,000 to 482,500. Economists emphasize the more-telling four-week moving average because it smooths out anomalies due to holidays, strikes and weather-related layoffs. Continuing claims, however, dipped 13,000 to 4.48 million.

A year ago, initial jobless claims totaled 575,000, the four-week moving average was 567,250 and continuing claims totaled 6.13 million.

Jobless claimsJobless claims are going the wrong way: They need to drop below 400,000 during the next two quarters to give economists and investors confidence that commercial activity is increasing at a pace that prompts most companies to curtail layoffs and resume hiring. During an adequate expansion, jobless claims can fall much lower. During the 2002-2007 expansion, they fell below 370,000 for more than two years. And during the Roaring 90s, jobless claims basically remained below 350,000 for more than five years.

States also reported 4.75 million people claiming Emergency Unemployment Compensation benefits for the week ending July 31, the latest week for which data are available, an increase of 260,105 from the prior week.

The highest insured unemployment rates for that week were Puerto Rico, 6.7%; Pennsylvania, 4.8%; New Jersey, 4.6%; Oregon, 4.6%; and California, 4.5%.

In sum, this week's jobless claims report serves as another data point regarding the U.S. labor market. True, continuing claims have dropped substantially, by about 28%, in the past year. But Emergency Unemployment Claims -- which were instituted to backstop Americans whose continuing claims benefit have expired -- are high. And now, initial jobless claims have risen back to the 500,000 level.

The latter suggests that companies this summer increased layoffs --- just the opposite of what the U.S. economy needs to lower its high, 9.5% unemployment rate. If the rise in initial jobless claims persists into the fall, that would likely decrease demand in the economy, reducing retail sales, corporate revenue and, most likely, U.S. GDP growth in the third quarter.

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map1246

Obammy rewards the lazy and stupid.

August 20 2010 at 9:12 PM Report abuse +2 rate up rate down Reply
susan

You go president O'Bama extend unempluymwnt again . Give me a check to sit on the couch. I wouldn't look for a job either.

August 20 2010 at 6:21 AM Report abuse +2 rate up rate down Reply
cmdrhlamb

hey, billy graham's son doens't know Muslim is a religion, not a race.....

August 19 2010 at 8:36 PM Report abuse -1 rate up rate down Reply
hazmatgirl561

Pizza Hut delivers.. so the topic is what Jobs????

August 19 2010 at 8:21 PM Report abuse +2 rate up rate down Reply
5 replies to hazmatgirl561's comment
otterdad48

The stimulus prevented another Great Depression but it was only about half a large as it should have bee.

August 19 2010 at 7:35 PM Report abuse -6 rate up rate down Reply
3 replies to otterdad48's comment
cmdrhlamb

some of us have hearts that have felt that warmth for the last ten years.....glad some are finally joining us......

August 19 2010 at 7:28 PM Report abuse -2 rate up rate down Reply
Jeffxs

Hillary will be the Dem's candidate in 2012. Obammy is done; stick a fork in him.

August 19 2010 at 7:11 PM Report abuse +3 rate up rate down Reply
1 reply to Jeffxs's comment
jmgair

How can this be in the Summer of Recovery ?? Obama, Biden, Pelosi & Ried all told us that the worst was behind us and we were saved from the brink of disaster. Maybe they simply mis spoke, you think ???

August 19 2010 at 7:05 PM Report abuse +3 rate up rate down Reply
calebos00

he could spend it the conservative way....spend billions destroying a country, spend billions rebuilding said country......yea, why help our citizens when we can give iraq infrastructure.....and one h*ll of a Embassy.......

August 19 2010 at 6:43 PM Report abuse rate up rate down Reply
3 replies to calebos00's comment
desking9

We are looking at the recycling of our economy. Companies are laying off high priced 1990's & 2000's workers and replacing them with newer lower wage workers. It's happening everywhere, this is why we are seeing unemployment numbers move back and forth over the months. Demand for products has dropped and yet, companies are making a ton of money. Less than what they were making before but still alot. These companies are buying their stock back at discount prices and hoarding the rest of the money. Once, balance sheets have been positioned appropriately. Credit will flow and a new cycle begins. When this will happen is the million dollar question. Until then, it will be a possibly long period of pain.

August 19 2010 at 6:27 PM Report abuse rate up rate down Reply