The number of US workers drawing state unemployment benefits scaled another record high early this month, according to government data today that highlighted the difficulties of getting new jobs in the recession-hit economy.
However, the number of people filing new claims for jobless benefits fell to a seasonally adjusted 646,000 in the week ended March 14th, the Labor Department said, still at levels consistent with a distressed labour market.
The prior week's number was revised up to 658,000 from 654,000. Analysts polled by Reuters had forecast 652,000 new claims.
“The data continues to show a tough labor market,” said Subodh Kumar, chief investment strategist at Subodh Kumar & Associates in Toronto.
“Overall the data corroborates that the Fed needs to be more aggressive, which is what they're doing,” he said. The US dollar pared losses against the euro, while government bond prices edged up after the data.
The Federal Reserve last nannounced that it would buy up to $300 billion worth of long-term US Treasuries to lower interest rates and help revive an economy now in its 15th month of recession.
The number of people staying on the benefits roll after drawing an initial week of aid surged 185,000 to 5.47 million in the week ended March 7th, the latest week for which the data is available, from 5.29 million the previous week.
This was the highest on record and pushed the insured unemployment rate, the percentage of US workers getting jobless benefits, to 4.1 per cent from 3.9 per cent the week before, the highest since June 1983.
Analysts had estimated the so-called continued claims would be 5.33 million.
“From a longer term perspective what concerns me about the US economy ... (is) the grinding nature of this slowdown and how slow moving the effects of the financial crisis are proving to be,” said TJ Marta, founder and market strategist at Marta on the Markets, in Scotch Plains, New Jersey.
Reuters