Posted on 24 Dec 2008
The number of Americans filing first-time claims for unemployment insurance last week rose to a 26-year high, indicating employers are stepping up job cuts as the recession deepens.
Initial jobless claims increased more than forecast to 586,000, the most since November 1982, from a revised 556,000 the prior week, the Labor Department said today in Washington. The four-week moving average of claims, a less volatile measure, also was the highest since 1982.
Employers including automakers accelerated firings in the final months of 2008, and job losses for the year are forecast to exceed 2 million. The deteriorating labor market prompted President-elect Barack Obama this week to expand his economic stimulus goals and call for creating or saving 3 million jobs over the next two years.
“This level is consistent with pretty significant declines in payrolls,” said James O’Sullivan, a senior economist at UBS Securities LLC in Stamford, Connecticut. “The economy is still deteriorating and I don’t think there will be a quick turnaround.”
Initial claims were projected to increase to 558,000, from an originally reported 554,000 the prior week, according to the median of 32 forecasts in a Bloomberg News survey. Estimates ranged from 535,000 to 595,000.