Unemployment Insurance Claims Up

News dampens hope for recovery

New claims for jobless insurance benefits in the United States posted a surprise rise, the Labor Department said Feb. 18 amid concerns unemployment could dampen economic recovery.

The seasonally adjusted initial claims in the week ending Feb. 13 rose to 473,000, an increase of 31,000 from the previous week's revised figure of 442,000, the Labor Department said.

The latest claims reading was larger than the forecast of most economists of around 430,000, as the world's largest economy emerged from its worst recession in decades with unemployment posing a key challenge.

Claims had tumbled to 432,000 during the week that ended Jan. 2 to their lowest level since mid-2008 but they had been volatile since the beginning of the year, casting doubts about a labor market recovery.

"It is important not to read too much into a week's worth of data, though; the general trend in claims in recent months has pointed to slow improvement in the labor market," said Andrew Gledhill, an economist at Moody's Economy.com.

The Labor Department said that the four-week moving average for the jobless insurance claims, a less volatile indicator than the week-to-week figures, was 467,500, a decrease of 1,500 from the previous week's revised average of 469,000.

The latest data also showed that the total number of Americans receiving unemployment benefits remained at the lowest level in more than a year.

The number of seasonally adjusted insured unemployment during the week ending Feb. 6 was 4.6 million, unchanged from the preceding week's revised level.

The Federal Reserve predicted the U.S. jobless rate would hover between 9.5 percent and 9.7 percent, higher than the November estimate of 9.3% to 9.7%, according to minutes of the central bank's policy meeting last month released Feb. 17.

With unemployment near double-digit level and predicted to come down slowly as economic growth gathers pace, President Obama acknowledged this week that for many Americans, the misery was not yet over.

"Millions of Americans are still without jobs. Millions more are struggling to make ends meet. It doesn't yet feel like much of a recovery. I understand that."

Copyright Agence France-Presse, 2010

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