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U.S. Initial Jobless Claims Rise to 399,000 as Companies Hold Off Hiring
Bloomberg ^ | 10-02-03

Posted on 10/02/2003 5:34:23 AM PDT by Brian S

U.S. Initial Jobless Claims Rose by 13,000 to 399,000 Last Week Oct. 2 (Bloomberg) -- The number of Americans filing initial applications for unemployment benefits rose last week, the government reported, a sign that economic growth has yet to boost demand for workers.

First-time claims during the week that ended Saturday totaled 399,000, an increase of 13,000 from a revised 386,000 a week earlier, the Labor Department said in Washington. The department said about half of the rise came from workers who had been unable to submit claims during Hurricane Isabel.

Companies trying to hold down costs have been reluctant to add to payrolls, instead using gains in efficiency to meet demand while the expansion gains momentum. The economy may have grown in the July-September quarter at the fastest pace since the first three months of 2002, according to a Bloomberg survey.

``The overall message we're getting is that the labor market is still struggling,'' said Doug Porter, a Toronto-based senior economist at BMO Nesbitt Burns Inc., the investment bank, before the report. ``The figures are consistent with no improvement in the trend.''

The number of people continuing to collect state unemployment insurance rose by 62,000 to 3.67 million in the week that ended Sept. 20. The level was the highest since June 28 for continuing claims, which are reported with a one-week lag to initial claims.

The insured unemployment rate, which tends to move with the monthly jobless rate, stayed at 2.9 percent in the week before last. During that week, 10 states and territories reported an increase in new claims, and 43 reported a decrease. The decline included a total reduction of almost 10,000 for North Carolina and Virginia, where Isabel had struck.

Higher Than Forecast

Economists estimated that claims would rise to 395,000 from the initially reported 381,000 the week before, based on the median of 37 forecasts in a Bloomberg News survey.

The four-week moving average of initial claims, a less volatile measure than the weekly number, fell to 403,500 from 408,500.

Tomorrow, the Labor Department is expected to report that the unemployment rate increased in September to 6.2 percent from 6.1 percent, based on the median of 64 forecasts in a Bloomberg News survey. The rate has exceeded 6 percent since May. Payrolls are likely to have fallen for the eighth month in a row.

Productivity expanded during April-June at more than triple the pace of the first quarter, government figures show. The economy may have expanded at a 4.5 percent annual rate in the third quarter, the most since the early last year, based on the median of forecasts in a Bloomberg News survey.

Impact on Spending

For the expansion to be sustained, companies will need to start adding workers, economists said. Otherwise, consumer spending will retreat when the extra cash from recent tax cuts and mortgage refinancing dwindles.

``If we don't see an end to job losses by the end of this year, then everyone will be marking down their growth forecasts for next year.'' Mark Zandi, chief economist at Economy.com, an economic forecasting and consulting firm in West Chester, Pennsylvania, before the report.

A ``notable'' risk to the outlook for improvement is ``that household spending could lose its forward momentum, particularly if there is no job growth,'' said Michael Moskow, president of the Federal Reserve Bank of Chicago, in a letter published yesterday in the bank's ``Executive Update.''

Ford Motor Co., the world's second-biggest automaker by sales, said yesterday it will cut as many as 3,050 jobs in North America by the end of the year, part of an effort by the Dearborn, Michigan, company to reduce global personnel costs 10 percent.

Safeco Corp., a Seattle-based home and car insurer, said it plans to sell its life insurance and asset-management unit and shed 500 jobs.

Yesterday, the New York-based Conference Board's said its consumer confidence index fell in September to the lowest level since the U.S. went to war against Iraq six months ago, as more people voiced concern over jobs.

Some economists expect companies to start hiring before year- end.

``As the economy continues to pick up speed, firms should begin to increase their hiring,'' Moskow said.

Growth is forecast at a 3.8 percent annual rate in both the first and second quarters of next year.

Last Updated: October 2, 2003 08:30 EDT


TOPICS: Business/Economy; Extended News; US: North Carolina; US: Virginia
KEYWORDS: bushrecovery; hurricaneisabel; jobmarket
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1 posted on 10/02/2003 5:34:23 AM PDT by Brian S
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To: Brian S; new cruelty
Any number below 400,000 means job additions.

``As the economy continues to pick up speed, firms should begin to increase their hiring,'' Moskow said.

We're all doomed.

2 posted on 10/02/2003 5:36:26 AM PDT by Texas_Dawg (You're trying hard not to show it... but, baby... believe me... I know it.)
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To: All
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3 posted on 10/02/2003 5:37:02 AM PDT by Support Free Republic (Your support keeps Free Republic going strong!)
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To: Brian S

4 posted on 10/02/2003 5:39:23 AM PDT by Consort
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To: Brian S
``As the economy continues to pick up speed, firms should begin to increase their hiring,'' Moskow said.

When, we have been hearing this for months.
5 posted on 10/02/2003 5:45:05 AM PDT by RiflemanSharpe (An American for a more socially and fiscally conservative America.)
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To: Consort
Well, it is doom and gloom if you happen to be one of those out of work for >6 months and still looking. I was out for just over 18 months and believe me, every single day seemd worse than the day before.

Overall, we are doing better, but until hiring picks up the economy will be vulnerable, and so will Bush.

6 posted on 10/02/2003 5:46:29 AM PDT by theDentist (Liberals can sugarcoat sh** all they want. I'm not biting.)
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To: RiflemanSharpe
"When, we have been hearing this for months. "

That reminds me of my 5 year old..."are we there yet? are we there yet? are we there yet?"

7 posted on 10/02/2003 5:47:16 AM PDT by Rokke
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To: theDentist
These posts just twist the knife in the wound.
8 posted on 10/02/2003 5:48:39 AM PDT by Consort
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To: ChromeDome
bttt
9 posted on 10/02/2003 5:53:54 AM PDT by ChromeDome
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To: RiflemanSharpe
When, we have been hearing this for months.

We have been hearing this for years.
10 posted on 10/02/2003 5:54:12 AM PDT by ARCADIA (Abuse of power comes as no surprise)
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To: ARCADIA
When, we have been hearing this for months.

We have been hearing this for years.

Then it is time for the politicians to start hearing us, on free traded (to dang costly if you ask me) and the economy.
11 posted on 10/02/2003 5:55:56 AM PDT by RiflemanSharpe (An American for a more socially and fiscally conservative America.)
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To: RiflemanSharpe
"Companies trying to hold down costs have been reluctant to add to payrolls, instead using gains in efficiency to meet demand while the expansion gains momentum. The economy may have grown in the July-September quarter at the fastest pace since the first three months of 2002, according to a Bloomberg survey. "

Companies are not done with gains in efficiency
12 posted on 10/02/2003 6:00:41 AM PDT by Pikamax
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To: Consort
I agree, but they do remind us of our vulnerability, and that is important. It shows us one of the fronts the Rats will use in their run for Presidency.
13 posted on 10/02/2003 6:01:10 AM PDT by theDentist (Liberals can sugarcoat sh** all they want. I'm not biting.)
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To: theDentist
All those posts can go in a forum called "Wallowing" where they can be easily found by anyone who enjoys them without having to search for them.
14 posted on 10/02/2003 6:06:10 AM PDT by Consort
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To: Texas_Dawg
"Any number below 400,000 means job additions."

How many weeks will it take to gain back the 2 million jobs lost - at the rate of 1,000 per week (400,000 - 399,000 = 1,000). How many weeks left before the '04 elections?

I admire your eternal hope to see the good side of all economic news. I usually think of this "blinded by the light..." after reading your comments.
15 posted on 10/02/2003 6:11:50 AM PDT by familyofman
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To: theDentist
I agree, but they do remind us of our vulnerability, and that is important. It shows us one of the fronts the Rats will use in their run for Presidency.

They already are, I go to college two nights a week to improve my skill set. In the science building the young democrats club has signs out commenting on the lose of jobs and asking people if they think there will be jobs around when they graduate. The job issue is an important issue in this election.
16 posted on 10/02/2003 6:13:57 AM PDT by RiflemanSharpe (An American for a more socially and fiscally conservative America.)
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To: familyofman
I usually think of this "blinded by the light..." after reading your comments.

And I think of the doom and gloomers as a bunch of people who think that worrying constantly somehow makes them seem more "concerned" or "in touch". Pure silliness, but it's exactly what Dan Rather and CNN count on.

17 posted on 10/02/2003 6:14:18 AM PDT by Texas_Dawg (You're trying hard not to show it... but, baby... believe me... I know it.)
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To: Texas_Dawg
And I think of the doom and gloomers as a bunch of people who think that worrying constantly somehow makes them seem more "concerned" or "in touch".

I can feel your pain - see I am concerned about your mental well-being. Hug, hug, kiss, kiss.

I think of myself as a realist & the numbers are not good. I wish it were otherwise - but wishing won't make it so - we're still on this side of the rainbow Toto.
18 posted on 10/02/2003 6:19:06 AM PDT by familyofman
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To: Consort
You can talk about the economy being better, and no one will personally attack you. No one is attacking Bush for these layoffs here - they blame Climtons's "globalization" slavery policies, which brought us here.

With that being said, your ugliness to those who are paying the price for Clinton's perfidy insinuates that you do not belong here. Rather than creating a "wallowing forum", perhaps you should go create some jobs if it's so damn easy.
19 posted on 10/02/2003 6:20:09 AM PDT by dandelion
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To: familyofman
I think of myself as a realist & the numbers are not good.

They're not? I think they're about as great as any people in the history of the world have ever had it.

20 posted on 10/02/2003 6:20:46 AM PDT by Texas_Dawg (You're trying hard not to show it... but, baby... believe me... I know it.)
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