January 12, 2012 in Nation/World

Unemployment benefit applications jump to 399K

WASHINGTON — Applications for weekly unemployment benefits spiked last week, largely because companies let go of thousands of workers after the holiday season.

Weekly applications rose by 24,000 to a seasonally adjusted 399,000, the Labor Department said today. That’s the highest level in six weeks.

Economists said such a jump is typical in early January and downplayed the increase. It followed three months of steady declines that brought applications to their lowest level in more than three years. And weekly unemployment claims have been below 400,000 in nine of the past 10 weeks.

That’s a “clear indication that the pace of layoffs has slowed,” said Steven Wood, chief economist at Insight Economics.

Applications typically soar in the first two weeks of the year. That’s because many companies lay off temporary workers who were brought on to help during the holidays. The department tries to adjust for those patterns. But the task is difficult because the data can be volatile.

“We would not read too much into the rebound in initial jobless claims,” Paul Dales, an economist at Capital Economics, said in a note to clients. “There (are) always problems in seasonally adjusting the weekly data around the turn of the year. As it stands at the moment, the trend in claims remains downwards.”

The four-week average, which attempts to smooth such fluctuations, also rose, to 381,750. It had fallen in the previous week to a three-and-a-half-year low.

When applications drop below 375,000 — consistently — that generally signals hiring is strong enough to reduce the unemployment rate. Prior to last week’s spike, applications had been below 375,000 for three of the past four weeks.

The unemployment rate fell in December to 8.5 percent, a three-year low. Employers added 200,000 net jobs, double November’s 100,000 gain.

More people are receiving benefits. The total unemployment benefit rolls increased to 7.3 million in the week ending Dec. 24, the latest data available. That is 111,000 higher than the previous week.

The economy gained 1.6 million jobs last year, up from 940,000 in 2010. Economists forecast roughly 1.9 million more jobs will be added this year, according to a survey by The Associated Press.

Still, the job market has a long way to go before it recovers from the damage inflicted by the Great Recession, which wiped out 8.7 million jobs. There are still more than 13 million unemployed people in the United States. And millions more who have given up looking and are no longer counted among those out of work.

The pickup in hiring reflects greater economic growth. The economy will likely expand by more than 3 percent at an annual rate in the final three months of last year, economists expect. Rising consumer spending will likely power much of the gain. That would be a sharp improvement over the 1.8 percent growth in the July-September quarter.

Even so, economists worry that growth could slow in the first half of 2012. Europe is almost certain to fall into recession because of its financial troubles.

And wages didn’t keep pace with inflation last year. So without more jobs and higher pay, consumers may have to cut back on spending. That could drag on growth this year. Consumer spending accounts for 70 percent of economic activity.

31 comments on this story so far. Add yours!

Nugget on January 12 at 9:27 a.m.
Where’s Obama bragging about this? LOL. Last week he was gushing about how he got people back to work. I said then the true test will be seeing what the level of unemployment was after the Christmas season layoffs. Lets look at th end of January/February. That is the true test!! As I thought!! Let’s see when he takes credit this time or if he blames Bush for it going back down.
Seasonal adjustments as always!!
crazyivan44 on January 12 at 9:35 a.m.
Seriously. More smoke and mirrors, here is the dirty little footnote they conveniently left out when declaring victory… Even more amusing since every other indicator pointed to stagnation except the inflated jobs figures.
RedCedar on January 12 at 10:00 a.m.
Seasonal adjustments are one thing, but the smokiest mirror of all was the decision to not count people who have quit looking for work. I’m not even sure which president to blame that on, but it happened within the past 5 years. If they included people who have quit looking, like they did until not too long ago, the unemployment rate would still be well into the double digits.
Using the same pig-lipstick that was used to improve the unemployment rate, think of all the other statistics that the government could improve: When calculating the poverty rate, don’t include people who have given up trying to make money. When calculating the murder rate, don’t count people who would have died pretty soon anyway or who probably had it coming. With a little bit of creative accounting like that, we could have the crime rate of Somalia and the finances of Greece and the president could campaign for re-election on the basis of how wonderfully he’s turned things around.
The_Seer on January 12 at 10:08 a.m.
redcedar: You are referring to the U-6 unemployment rate and that figure has been around for decades.
Perhaps this will help:
U1:[80] Percentage of labor force unemployed 15 weeks or longer.
U2: Percentage of labor force who lost jobs or completed temporary work.
U3: Official unemployment rate per the ILO definition occurs when people are without jobs and they have actively looked for work within the past four weeks.[2]
U4: U3 + “discouraged workers”, or those who have stopped looking for work because current economic conditions make them believe that no work is available for them.
U5: U4 + other “marginally attached workers”, or “loosely attached workers”, or those who “would like” and are able to work, but have not looked for work recently.
U6: U5 + Part time workers who want to work full time, but cannot due to economic
The U3 figure is almost always the one that is quoted in news sources.
johnclarke on January 12 at 10:09 a.m.
Well if Obama had not invented the holiday season we would not have this problem. Clearly it would be much better if there were no seasonal workers.
liberal_in_right_wing_land on January 12 at 10:11 a.m.
Hey at least he is doing something. How many jobs bills have the republican controlled House of Representatives put forth…..you know the branch of government whose job it is to write the bills for the other branches of government to read and pass or sign into law……..thats right, the republican controlled House of Representatives have put forth ZERO jobs bills to help out the unemployed in this country.
Yes, yell and complain about Obama all you want crazy people, but what has your party done to try and help the middle class and create jobs for the last 30 years?
Amazing how many times we liberals ask this question to you conservatives on here only for nobody to ever answer it because the republicans have done nothing.
Maybe some more tax cuts for the job creators will do the trick, you know, since its worked out great the last 10+ years.
johnclarke on January 12 at 10:36 a.m.
Liberal, now be nice. You have to remember that the Republicans are better Americans than all non-conservatives; therefore they don’t have to help anyone besides their masters. The middle and lower classes simply do not deserve help of any kind. In fact, they don’t even get a fair shot.
jddavis on January 12 at 10:46 a.m.
Easy research…
http://www.washingtontimes.com/news/2011/oct/25/white-house-backs-house-gop-jobs-bill/
Seer—thanks for putting up / clarifying the U* definitions.
Nugget on January 12 at 10:55 a.m.
That’s okay. We had a Demoncratic controlled House/Senate for 4 years & they got nothing done. Last two years of when Bush was in office & another two years for Obama’s reign. So go ahead & try to blame it all on the Republicans. But Demoncrats couldn’t do anything when they had ALL the power to do so.
LOL………Sad, sad, sad for the American people.
pmbrown49 on January 12 at 11:43 a.m.
I don’t care what Obama, Reid, Pelosi, Boehner, Cantor or anyone else says, this economy is still a LONG way off from being alot better. How many of you are better off in the 3 years that Obama has been in office or GWB’s last 2 years of his 8? I’ll bet not a whole lot better.
I know with near certainty that your house is probably worth less than it was 4 years ago even if your income has remained constant or grown a bit.
I’d suggest paying less attention to “sound-bite” statistics that come out of the government every Thursday or Friday and looking at the “big picture” more.
Dazzeetrader11 on January 12 at 12:27 p.m.
It’ll get worse…again.
WHS on January 12 at 2:12 p.m.
Yes you are right… It will continue to get worse as long as we have a group of politicians already in office that refuse to help fix things. Until our elected representatives decide to start representing and quit the party BS, America will continue to struggle.
Seriously, imagine if the “republicans” in office decided to actually start doing their job, instead of stalling, just how much better things would be. Think about this… If all those morans you teabaggers elected started working with the Democrats and the President, and if things started to improve… Well guess what? Yup, we would have a Republican president come next year. They would have proven they can get it done Instead you all think that making things worse will get your man elected… You just don’t realize that most of mainstream middle America is smarter than you think… And can see right through the ruse.
This is what happens when you elect idiots on an idiotic platform.
WHS
mikeln on January 12 at 2:45 p.m.
I see no difference among these people. All of them have one thing on thier mind, oh, I mean two. We all know what these things are and they sure do not contain help for the middle class. Hell, they won’t even let the money we give them through taxes help with the rebuilding of america. That money is now going to china. We now have a situation that makes electing people that have solutions impossible thanks to the court. Yet we bicker about who is to fault. Guess what, it’s us! We are at fault for not demanding change. Nothing short of mass protest will bring a government so full of crimminals to its senses and show them we are not going to take thier corruption anymore.
force_vector on January 12 at 2:54 p.m.
“Nothing short of mass protest will bring a government so full of crimminals to its senses and show them we are not going to take thier corruption anymore.”
Or, we can just stop voting for them and those like them.
Scoutster on January 12 at 3:24 p.m.
If only John McCain were president!
This wouldn’t have happened.
Diana on January 12 at 3:58 p.m.
Nugget, you are quite wrong. Dem control of Congress for the first two years is false and is a favorite of bagger copy and pasters who find it too difficult to think for themselves.
The majority only lasted 6 months. Election 2008 gave Democrats a total of 58 Democratic Senators. Spector switched parties in April, which brought the count to 59. Sen. Franken didn’t get sworn in until July 7, 2009, which is when the count went up to 60. Ted passed in August, and his replacement was named at the very end of September, and replaced with a Republican in January.
Six months.
mikeln on January 12 at 4:16 p.m.
And just who we vote for if not them? The game is rigged and not in favor of the common man, left or right. Only a few are in charge and we have no idea of who they are, just that they are the puppet masters.
Middleman on January 12 at 4:46 p.m.
The national employment figures are an economic bellwether as we all know. Everyone sits around waiting for the new figures to be posted and what happens? Either the consumer confidence goes up, or down. It never stays the same. The score profoundly affects U.S. markets, consumer spending, and even the fate of national elections as we are seeing right now and likely will as we approach the summer. With so much at stake, you’d think we would be counting the workforce accurately. Unfortunately, we’re not. Its too bad they don’t tell us the REAL unemployment rate.
Middleman on January 12 at 4:55 p.m.
In 1878, our government tried to do something that nobody had apparently ever done before. They attempted to actually count the unemployed.
As today, the 1870s were a time of economic fear, with a financial crisis (panic of 1873). So, the governement put together some odd rules to count the unemployed that were actually seeking work so that the unemployment numbers would be lower, thus not causing a great stir in the media and financial sector of the country.
They actually, at that time, counted only adult men who “really want employment.” I know…crazy.
Their method for counting back then (and not counting) became the basis for Census tallies back then and for the monthly employment report put out by the Bureau of Labor Statistics.
We still do basically the same today. I heard a guy a few months ago from an economic “think tank” who said the “actual” unemployment rate at any one time is usually DOUBLE what is reported using the current methods of counting. Scary stuff people!!!
Middleman on January 12 at 4:56 p.m.
And it doesn’t matter who is sitting in the Oval Office. They both fail to report the truth when they have it within their power to do otherwise!!!
force_vector on January 12 at 4:59 p.m.
mikeln - I agree that the game is rigged. Unfortunately, and I have thought about this a lot, I don’t see a solution. We can only elect those who chose to run. Many who would be good leaders choose not to run because we allow ourselves to vote based on ridiculous attack ads and smear campaigns. The common man simply doesn’t have the resources to respond to those tactics. Perhaps the first step in the repair process is for us as voters to demand better. No more allowing negative ads to influence our thoughts, no more simplifying arguments to the point of idiotic, no more voting based upon party affiliation (I’d love to see both parties constitutionally abolished), and no more hearing only what fits into what we want to be true, rather than what IS true.
This is our country. If we want it back, we have to act like it.
pmbrown49 on January 12 at 6:13 p.m.
Diana, sorry but the Dems didn’t do “great” things in the 6 months you claim they had a true majority. Obamacare is proving to be unsustainable, doctors are going bankrupt and those who remain will continue to see less and less members of our Medicare population.
The rationing people were concerned about for those over 65 will come to bear as an access to healthcare issue based on ability to pay. Only those who can afford to pay for care without Medicare footing the bill will get care. The others won’t. Obama’s cutting of Medicare payments GUARANTEES this rationing outcome.
force_vector on January 12 at 6:29 p.m.
pmbrown - there is very little point in discussing anything with Diana. She believes whatever she wants, and would rather bend truth than change her mind, let alone consider what you have to say. She’s nothing more than one of the dilusional sheep, trimming grass for her parties lawn.
Diana on January 12 at 7:01 p.m.
With all due respect, pmbrown and farce_vector, I made no such claim. I was responding to Nugget’s false claim that Dems controlled the Senate for the first two years of Obama’s presidency. The Dems did not. Six months.
There are plenty of classes available for remedial reading and comprehension. Look into it.
misjustice on January 12 at 7:54 p.m.
Scouster is correct.
If only grumpy gramps McSame and the 1/2 wit 1/2 term Quitter on Twitter would have stolen, errr, won the election in 2008 things would be soooooo much better.
Hell, within a month of taking office, she would have pushed gramps down a back staircase in the Whitehouse (killing him), effectively going from VeePee to POTUS and then she would have quit in 2010; elevating Mr. Boner to POTUS.
Sigh….if only….
; )
force_vector on January 12 at 7:56 p.m.
farce_vector….how witty. Furthermore, your ability to count to six far exceeds (by no less then two) what I would have expected. Congrats.
force_vector on January 12 at 8:09 p.m.
Justice - At least give proper credit if you’re going to use someone’s line…
http://www.sodahead.com/united-states/will-the-quitter-on-twitter-sarah-palin-ever-learn-to-fact-check-before-she-spouts-out-her-paranoia/question-726247/
misjustice on January 12 at 8:25 p.m.
Hey, force, they stole it from ME!
They should be giving ME the credit; I coined the phrase months before that hack on SodaHead used it!
; )
force_vector on January 12 at 8:32 p.m.
What!? That site has at least 4, maybe 5 followers. You could easily make a hundred bucks in a lawsuit. Just send them your SR name and photo, they’ll settle.
misjustice on January 12 at 9:10 p.m.
; )
You’re funny!
greenlibertarian on January 12 at 11:20 p.m.
force_vector on January 12 at 4:59 p.m.
mikeln - I agree that the game is rigged. Unfortunately, and I have thought about this a lot, I don’t see a solution. We can only elect those who chose to run. Many who would be good leaders choose not to run because we allow ourselves to vote based on ridiculous attack ads and smear campaigns. The common man simply doesn’t have the resources to respond to those tactics. Perhaps the first step in the repair process is for us as voters to demand better. No more allowing negative ads to influence our thoughts, no more simplifying arguments to the point of idiotic, no more voting based upon party affiliation (I’d love to see both parties constitutionally abolished), and no more hearing only what fits into what we want to be true, rather than what IS true.
Very well said.
You and I often get sideways, and we probably will again, but what you wrote there, spur of the moment I’m sure, gets to the crux of the problem.
For me, the next leg in the problem is that a Congresscritter has to spend from 30-50% of their time RAISING MONEY FOR RE-ELECTION! And the really “popular” ones will raise money that they’ll give to somebody else (in their party) who’s running for re-election!
Million, two million dollar House campaigns for a job that pays $200K a year with all benefits added in. Then when they leave Congress, they work as lobbyists for some special interest, starting out pay $500,000 with substantial bonuses.
Note than in the past 15-20 years, Congresscritters have become EVEN MORE WEALTHY than average Americans than they were in the past.
10,000 lobbyists in D.C. They don’t work for free, and they wouldn’t be doing what they’re doing if it weren’t a great investment.
Thus, a 100 thousand page tax code with perks for all of Uncle Sucker’s “preferred” vendors and companies who paid for it.