New jobless claims go below 600,000
WASHINGTON - Even though new claims for jobless benefits fell more than expected last week, dipping below 600,000 for the first time since early January, the number of Americans seeking this safety net points to an economy that is still very weak.
Layoffs are slowing, but jobs are scarce, leaving nearly 7 million Americans collecting unemployment checks and retailers looking for customers.
The number of newly laid-off workers requesting unemployment insurance fell by 52,000 to a seasonally-adjusted 565,000, the Labor Department said yesterday. But the drop was mostly because of a shift in the timing of auto-related layoffs, leading many economists to discount the decline.
Weekly claims remain far above the 300,000-350,000 range that analysts say is consistent with a healthy economy. New claims last fell below 300,000 in early 2007. The lowest level this year was 488,000 for the week ended Jan. 3.
Yesterday’s figure indicates that “very steep job losses’’ probably will continue and that the unemployment rate will keep rising, said Zach Pandl, an economist at Nomura Securities International. Claims may not drop to 350,000 until the middle of next year, he said.
Employers cut 467,000 jobs in June, more than analysts expected, while the unemployment rate rose to 9.5 percent, the highest in 25 years. The lack of jobs is limiting consumer spending, which will weaken or even delay any economic recovery.
The number of people on the jobless benefit rolls jumped 159,000 to 6.88 million, the Labor Department said. That’s the highest tally on records dating from 1967. 