JoblessBy Jason Lange

The number of Americans lining up for new jobless benefits fell last week for the first time since April, a hint that a slowdown in hiring last month may only be temporary.

The data on state unemployment claims, released by the Labor Department on Thursday, takes some of the edge off a report last week that showed a sharp slowdown in job creation in May.

Many economists believe mild weather in the winter led employers to hire more workers at the expense of spring, but that the weather effect should be temporary. Some economists suggested the claims data backed that view.

"[It] gives us more confidence that the trend in payrolls is stronger than the May payroll data implied," UBS said in a note to clients.

Four consecutive months of slowing job creation have fueled speculation the U.S. central bank would ramp up efforts to prop up the economy.

However on Thursday Fed Chairman Ben Bernanke, speaking in congressional testimony, offered few hints that further monetary stimulus was imminent, even though he said the U.S. central bank was ready to shield the economy if financial troubles mount.

The Labor Department said initial claims for state unemployment benefits dropped 12,000 to a seasonally adjusted 377,000. That was spot on the median forecast in a Reuters poll.

"The fact that the number didn't back up is a strong sign that the economy is holding in," said Carl Riccadonna, an economist at Deutsche Bank in New York.

Prior to last week, claims had risen in four consecutive weeks, adding to concerns over several months of lackluster hiring data. While the country emerged from a deep recession three years ago, the jobless rate was 8.2 percent in May, well above its long-term historical average.

Still, most of the recent increases in new jobless claims were marginal and the overall level of claims has held at levels consistent with a modest recovery in the labor market.

"I think the Fed looks at it and certainly leaves the door open for further action but it is not a ringing bell that it should take action right now," said Peter Jankovskis, an investment officer at Oakbrook Investments in Lisle, Ill.

U.S. stock prices pared gains following Bernanke's comments, but remained higher after the Chinese central bank cut bank lending and deposit rates, fueling hopes of coordinated international action to aid a fragile global economy.

The last time claims fell was in the week that ended April 28. The four-week moving average for new claims, a measure of labor market trends, increased 1,750 last week to 377,750.

The Labor Department last week said job growth slowed in May for the fourth straight month, heightening concerns that the deepening debt crisis in Europe and a slowdown in China were starting to dampen an already lackluster U.S. recovery.

Concerns over the course of U.S. fiscal policy may also be weighing.

A Labor Department official said no states estimated their data for last week.

The report showed the number of people still receiving benefits under regular state programs after an initial week of aid rose 34,000 to 3.29 million in the week ended May 26.

The number of Americans on emergency unemployment benefits fell 45,808 to 2.57 million in the week ended May 19, the latest week for which data is available.

The number of people on extended benefits slipped 58,829 to 253,605. Most states that were eligible for the extended benefits program following the 2007-09 recession lost that eligibility this year as their labor markets improved or stabilized.

That could artificially push down the unemployment rate later this year if people dropping off the benefits rolls give up the hunt for work.

A total of 5.97 million people were claiming unemployment benefits during the week ending May 19 under all programs, down 167,133 from the prior week.

Increase your money and finance knowledge from home

Socially Responsible Investing

Invest in companies with a conscience.

View Course »

Intro to Retirement

Get started early planning for your long term future.

View Course »

Add a Comment

*0 / 3000 Character Maximum


Filter by:

Jobless claims did not fall, people fell off unemployment. Get your facts straight. Maybe you get paid for what you do, but your very poor at what you do. Tell the truth.

June 08 2012 at 11:19 AM Report abuse +2 rate up rate down Reply

I haven't understood this for awhile but maybe I'm just dense. We have over 350,000 people filing "first time" jobless claims each and every week meaning, I presume, that in any given week this number of people have lost their job and have filed for unemployment for the first time. Given that, wouldn't almost 1.5 million "new" jobs would have to be created each month just to cover those jobs that we're lost. BO states he has created 4.5 million "new" jobs since taking office - isn't that only 3 months worth of what has been lost? The monthly jobs report doesn't come even remotely close to creating new jobs to cover this loss. What am I missing if anything? Or is it simply government smoke and mirrors.

June 08 2012 at 10:40 AM Report abuse +1 rate up rate down Reply

No doubt the numbers went up for those whose unemployment benefits ran out and immediately filed for "disability"....

June 08 2012 at 10:31 AM Report abuse rate up rate down Reply

That will change upward next week after they revise them for the 66th time inthe last 67 weeks....pretty sad when you celebrate that ONLY 377,000 Americans are out fo a job in one week..

June 08 2012 at 9:54 AM Report abuse rate up rate down Reply

Hurrah, Yippiee, Super........what's that? A knock at the door.....who could it be? It's just a foreclosure notice.......But wait I thought everything was going great....................Thanks Obama, You've screwed a generation. As a taxpayer I now owe over $100K since you took office. If I pay $6K extra per year it will only take anbout 30 years plus interest at 1%. That's in addition to the regular tax bill I have to pay. Think about it $6K NOT going to house payments, food, insurance (including health insurance), education etc.........I am ashamed at this country and thier willingness to place an inexperienced organizer at the helm. Stop the madness now.

June 08 2012 at 9:28 AM Report abuse +1 rate up rate down Reply

The GAO says real unemployment is at 14.7% which includes unemployed looking for work, unemployed who gave up and underemployed.
UI claims slightly drop and I cannot wait to see the spin Obama puts on regarding these absolutely disatrours numbers.

June 08 2012 at 8:49 AM Report abuse +1 rate up rate down Reply

Lets give more tax breaks to those Mega Billionaires who are the job creators?? Like Walmarts and their high paying jobs??? lol

June 08 2012 at 7:33 AM Report abuse +1 rate up rate down Reply
1 reply to kev's comment

I know what you mean Kev. Rich people like the Obamas irritate me too. Maybe if you wish hard enough
you'll get that increase in your welfare check you think your entitled too.

June 08 2012 at 11:29 AM Report abuse +1 rate up rate down Reply

Just as everybody is claiming false unemployment figures now?? Was my case against Bush's so called 4 percent unemployment!! You really didn't believe those numbers back then?? You guys are as bad as birthers

June 08 2012 at 7:31 AM Report abuse -1 rate up rate down Reply
1 reply to kev's comment

Oh Kev is throwing out the birther card. Can't defend your hero Obama so you're back to bringing up George Bush.

Even Obama said we were better off 4 years ago then we are now.

Kev has a serve case of Bush derangement syndrome. Maybe it would help if you gazed at your Obama poster hanging over bed and get that tingling going up your leg again. LMAO

What an Obamaite.

June 08 2012 at 11:35 AM Report abuse +2 rate up rate down Reply

These statisticians need to quit relying on paper figure and get out of their office into the real world. Hiring in my location is way down (unemployment rate of over 10% in my hometown). The unemployment office reports that jobless claims are down; of course they are because all benefits have been exhausted. I do not see any new job offerings posted on their website, or in the newspaper for that matter. This story seems to be a "buffer" to help increase the morale of those who cannot find a job.

June 08 2012 at 4:33 AM Report abuse +1 rate up rate down Reply

Are you kidding? Hundreds of thousands of unemployed are losing their "extended" benefits, and so are no longer counted as "unemployed".

The best statistics are that between 100,000 to 500,000 NET jobs have been lost since Obama took office.

Fewer people are working than any time in the last 30 years.

HuffPuff and the Obama-media are LYING in order to try to re-elect Obama.

There are no new jobs, and unemployment is running out. Companies are starting to run out of people to lay off. That's not "progress", and that's not "growth".

As Bill Clinton said: We are still in a "Recession".


June 08 2012 at 4:27 AM Report abuse +3 rate up rate down Reply