Bushonomics: Jobless claims surge to 26-year high

24 December 2008

WASHINGTON– The number of U.S. workers filing new claims for jobless benefits jumped by 30,000 to a 26-year peak last week, government data on Wednesday showed, as the country's year-long recession continued to chill the labor market.

Initial claims for state unemployment insurance benefits rose to a seasonally adjusted 586,000 in the week ended Dec 20 from a revised 556,000 the prior week, the Labor Department said. It was the highest since the week ended November 27, 1982, when initial claims rose 612,000.

Analysts polled by Reuters had forecast 560,000 new claims versus a previously reported count of 554,000 the week before.

A Labor Department official said there were no special factors influencing the data and no noticeable impact from severe winter weather in northern parts of the country.

The official also said a number of states had reported increasing layoffs in the auto industry, which has been hit hard by consumers cutting back on their spending in the face of rising unemployment and scarcer credit.

The four-week average of new jobless claims, a better gauge of underlying labor trends because it irons out week-to-week volatility, increased to 558,000 from 544,250 the week before. This was the highest reading since December 1982.

This measure has mounted steadily as the U.S. economy suffers from a credit crisis sparked by the housing slump, forcing lay-offs as firms slash costs to offset weaker income.

The number of people remaining on the benefits roll after drawing an initial week of aid declined by 17,000 to a less-then-forecast 4.370 million in the week ended December 13, the most recent week for which data is available. Analysts had estimated so-called continued claims would be 4.400 million.

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New unemployment claims reach 26-year high

More than half million jobs axed in November

Commentary:

Along with ever increasing unemployment, consumer spending fears of further poverty hit’s, along with threats of tax increases of what can be ill-afforded within the crumbling economy; one has the ever increasing rampant business failures across the whole spectrum of the US.

As to the problem of housing failures, it more appears many Americans are more worried if they will also be able to afford just to go to the market, with the ever increasing higher prices on just food to feed themselves and there families.

Some economist have expressed if they are further teetering on the brink of full collapse after the New Year, while other more optimist’s are saying a possible upswing maybe by 2010; while the next figure is 2015.