US filings for unemployment aid at a 5-week high

Mi-Ran Park-Wong, of Macy’s, speaks to a job appli­cant dur­ing a career expo spon­sored by Jobs Direct USA in Orlando, Fla. The num­ber of Amer­i­cans seek­ing unem­ploy­ment ben­e­fits rose last week to a five-week high, evi­dence that the job mar­ket remains slug­gish. The Labor Depart­ment said Thurs­day that weekly appli­ca­tions for unem­ploy­ment aid rose 10,000 to a sea­son­ally adjusted 383,000. (Asso­ci­ated Press | John Raoux)

CHRISTOPHER S. RUGABER

AP Eco­nom­ics Writer

WASHINGTON — The num­ber of Amer­i­cans seek­ing unem­ploy­ment ben­e­fits rose last week to a five-week high, evi­dence that the job mar­ket remains sluggish.

The Labor Depart­ment said Thurs­day that weekly appli­ca­tions for unem­ploy­ment aid rose 10,000 to a sea­son­ally adjusted 383,000. The four-week aver­age, a less volatile mea­sure, increased for the first time in a month to 374,500.

Econ­o­mists were dis­ap­pointed by the data, par­tic­u­larly when cou­pled with a sep­a­rate report Thurs­day that showed only mod­est hir­ing by pri­vate busi­nesses in May. On Fri­day, the gov­ern­ment will report on May hir­ing by pri­vate and pub­lic employers.

“The jobs data were not reas­sur­ing ahead of tomorrow’s … report,” said Jen­nifer Lee, an econ­o­mist at BMO Cap­i­tal Markets.

Appli­ca­tions had declined to roughly 370,000 for four weeks. That drop sug­gested that hir­ing could pick up in May. When appli­ca­tions drop below 375,000, it typ­i­cally sug­gests that hir­ing is strong enough to reduce the unem­ploy­ment rate.

Thursday’s data doesn’t fig­ure into the May employ­ment report, to be released Fri­day. That report is based on fig­ures gath­ered in the mid­dle of the month. Ana­lysts expect it will show that employ­ers added 158,000 jobs, while the unem­ploy­ment rate remained 8.1 percent.

That would be an improve­ment from April, when employ­ers added only 115,000 jobs. But it would be slower than the blis­ter­ing pace set this win­ter, when the econ­omy gen­er­ated an aver­age of 252,000 jobs a month from December-February.

The num­ber of peo­ple receiv­ing ben­e­fits fell, partly because extended ben­e­fits pro­grams are end­ing in many states. About 6.1 mil­lion peo­ple received ben­e­fits in the week that ended May 12. That’s down 30,750 from the pre­vi­ous week.

Sep­a­rately, a pri­vate sur­vey showed that busi­nesses boosted hir­ing only slightly in May. Pay­roll provider ADP says busi­nesses added 133,000 jobs. That’s slightly bet­ter than the revised total of 113,000 jobs it reported for April, which was the weak­est in seven months. The report cov­ers only hir­ing in the pri­vate sec­tor; it excludes gov­ern­ment jobs.

The unem­ploy­ment rate has fallen from 9.1 per­cent in August to 8.1 per­cent last month. Part of the rea­son for the drop is that employ­ers added 1.5 mil­lion jobs dur­ing that time. But it has also declined because some peo­ple gave up look­ing for work. The gov­ern­ment counts peo­ple as unem­ployed only if they’re actively look­ing for a job.

Econ­o­mists have cau­tioned that a warm win­ter led com­pa­nies to move up some hir­ing and accel­er­ate other activ­ity that nor­mally wouldn’t occur until spring. That gave the appear­ance that the econ­omy had strength­ened in Jan­u­ary and Feb­ru­ary and weak­ened in early spring.

Recent eco­nomic indi­ca­tors, mean­while, have been mixed.

Con­sumer con­fi­dence fell sharply in May to its low­est level since Jan­u­ary, the Con­fer­ence Board said Tues­day. Amer­i­cans were more wor­ried about jobs, hous­ing and the stock mar­ket. Lower con­fi­dence could lead con­sumers to cut back on their spending.

But that sur­vey con­trasted with a report, released Fri­day, by Thom­son Reuters/University of Michi­gan that found con­sumer sen­ti­ment rose to its high­est level in four and a half years.

Econ­o­mists said the dif­fer­ence between the two is partly explained by tim­ing. The Con­fer­ence Board’s sur­vey was com­pleted by May 16, just before stock prices lev­eled off after falling steadily. Gas prices also fell fur­ther after the sur­vey was com­pleted. The Uni­ver­sity of Michigan’s report con­tin­ued until later in the month and would have cap­tured both of those trends.

There are signs the hous­ing mar­ket is slowly improv­ing. Home prices rose in March from the pre­vi­ous month in most major U.S. cities for the first time in seven months, accord­ing to the Stan­dard & Poor’s/Case-Shiller home price index. Prices rose in 12 of the 20 cities it tracks. Some of the increase was due to the start of the spring home sell­ing sea­son. The month-to-month price changes aren’t sea­son­ally adjusted.

In April, sales of both pre­vi­ously occu­pied homes and new homes rose near two-year highs. Builders are gain­ing more con­fi­dence in the mar­ket as traf­fic from poten­tial buy­ers rises, accord­ing to an indus­try survey.

Build­ing per­mits have risen in recent months, though they fell in April from nearly a two-year high, the National Asso­ci­a­tion of Real­tors said Wednesday.

Long-term mort­gage rates have never been lower. The aver­age rate on the 30-year fixed mort­gage fell to 3.78 per­cent last week, the low­est since long-term rates began in the 1950s.

Still, the pace of home sales remains well below healthy lev­els. Econ­o­mists say it could be years before the mar­ket is fully healed.

Posted by AP News on May 31 2012. You can follow any responses to this entry through the RSS Feed. Comments can be made below.