Ahead of the Bell: Jobless claims

AP News
Posted: Dec 31, 2009 6:17 AM

The number of newly laid-off workers seeking unemployment benefits likely rose slightly last week, a sign that jobs remain scarce even as the economy slowly recovers.

A Labor Department report is expected to show new unemployment insurance claims rose by 8,000 to a seasonally adjusted 460,000, according to economists surveyed by Thomson Reuters.

Economists closely monitor initial claims, which are considered a gauge of the pace of layoffs and an indication of companies' willingness to hire new workers.

Claims have dropped rapidly in the past two months, an indication that companies are shedding fewer workers. The drop has also raised hopes that the economy may see a net increase in jobs as soon as January or February. Claims have dropped by 80,000, or 15 percent, since late October.

Last week's report said 452,000 people filed first-time claims, the lowest total since the week of Sept. 6, 2008. Thursday's report is due at 8:30 a.m. EST.

Despite the recent improvement, claims likely have to fall to about 425,000 for several weeks to signal the economy is actually adding jobs, according to many analysts.

The number of people continuing to claim benefits, meanwhile, is expected to rise by about 34,000 to 5.1 million for the week ending Dec. 19. Those figures lag initial claims by a week.

But the so-called continuing claims do not include millions of people that have used up the regular 26 weeks of benefits typically provided by states, and are receiving extended benefits for up to 73 additional weeks, paid for by the federal government.

About 4.7 million people were receiving extended benefits in the week ended Dec. 5, the latest data available, about the same as the previous week.