 |
|
Some 3.83M citizens draw unemployment
11/16/2001
By JEANNINE AVERSA WASHINGTON — New claims for state unemployment benefits fell for the third
straight week, but the number of laid-off Americans collecting benefits still
reached an 18-year high. The Labor Department reported Thursday that for the work week ending Nov. 11,
new jobless claims fell by a seasonally adjusted 8,000 to 444,000. Even though new claims declined for the third straight week, the level of
claims remained high enough to suggest that the labor market continues to be
weak. The number of laid-off workers continuing to receive unemployment benefits
climbed to 3.83 million for the work week ending Nov. 3, indicating that jobless
workers are having a difficult time finding employment. That was the highest
level since Feb. 12, 1983. ``The jobless claims report tells two different stories. On the one hand,
layoffs seem to be abating after the big jump following Sept. 11, but those
finding themselves out of work seem to be getting hit with an economywide hiring
freeze,'' said economist Clifford Waldman of Waldman Associates. To cope with the sour economy and fallout from the terror attacks, companies
have cut production, trimmed hours and let workers go. The nation's unemployment rate soared from 4.9 percent in September to 5.4
percent in October and companies eliminated 415,000 jobs, the biggest one-month
drop in 21 years. Economists predict the jobless rate will climb and payrolls
continue to be trimmed. Wall Street investors, feeling more confident about an economic turnaround in
2002, pushed blue chip stocks higher. The Dow Jones industrial average gained
48.78 points to close Thursday at 9,872.39. The decline in new claims last week put them at the lowest level since the
week ending Sept. 15. That earlier report, however, did not capture layoffs
resulting from the terror attacks because most affected workers were not able to
file applications for jobless benefits that week. In the two weeks following
that report, jobless claims rocketed. Last week's decline in new claims followed a drop of 44,000 in the preceding
week and a decline of 11,000 the week before. ``The slide suggests that the pace of job loss is abating and that the
economy is beginning to recover from the terrorist attack, although the level of
claims remains high enough to cause a steady further loss of jobs and a rise in
unemployment,'' said Maury Harris, chief economist at UBS Warburg. Some economists believe the unemployment rate will top out at around 6.3
percent in the first quarter of 2002. The more stable four-week moving average of new claims, which smoothes out
week-to-week fluctuations, declined last week to 474,750, the lowest since early
October. Also Thursday, the Commerce Department said businesses whittled inventories
by 0.5 percent in September, following a 0.2 percent drop in August. Faced with
sagging sales, companies are trying to get rid of excess stocks of unsold goods.
Fallout from the more-than-yearlong economic slump, along with the terror
attacks, caused the economy to contract at a rate of 0.4 percent in the
July-September quarter. Many economists are predicting a bigger drop in the
current quarter. That would meet one common definition of a recession: two
consecutive quarters of declining economic output. In an effort to prevent the economy from sinking deeper into recession, the
Federal Reserve has cut interest rates three times since Sept. 11, and 10 times
this year. Economists and the Bush administration are counting on the Fed's aggressive
easing, President Bush's tax relief enacted earlier this year and new tax cuts
and increased government spending being contemplated by Congress to lead to a
recovery in 2002. ``I'm convinced that the U.S. economy is putting down the basis for a return
to a good rate for real growth as we move into next year,'' Treasury Secretary
Paul O'Neill said. On the Net: Jobless claims reports: http://www.doleta.gov/ Inventories report: http://home.doc.gov/
Associated Press Writer