First-time claims for unemployment insurance for the week ended May 11 rose 32,000 to 360,000, the highest level since the end of March, the ""Labor Department"":http://www.ows.doleta.gov/press/2013/051613.asp reported Thursday. Economists expected initial claims to increase to 330,000. First-time jobless claims for the week ended May were revised up to 328,000 from the originally reported 323,000.[IMAGE]
With the revision, the increase in first-time claims was the second in a row.
The number of persons continuing to collect unemployment insurance for the week ended May 4, reported on a one week lag, fell 4,000 to 3,009,000. Continuing claims for the week ended April 27 were revised up to 3,013,000 from the originally reported 3,009,000.
The four-week moving average of initial claims rose 1,250 to 339,250--the first increase in the average in four weeks. The four week moving average of continuing claims fell 21,000 to 3,015,250.
Comparative data for continuing claims are becoming increasingly less reliable as effects of sequester cuts affect the numbers. Some states are reducing the number of weeks of payments while others are cutting payments themselves.
The sharp week-over-week increase in unemployment claims was a disappointment after steady improvement in this data series. After rising through March, initial claims had been falling at a steady pace through mid-April.
The most recent data report though on layoffs--in the Job Openings and Labor Turnover Survey for March--showed a sharp increase in layoffs to the highest level in six months.[COLUMN_BREAK]
The Labor Department also said states reported 1,792,101 persons claiming EUC (Emergency Unemployment Compensation) benefits for the week ending April 27, an increase of 28,924 from the prior week. There were 2,666,055 persons claiming EUC in the comparable week in 2012. EUC benefits are threatened by the federal budget sequester.
The total number of people claiming benefits in all programs for the week ending April 27, the Labor Department said, was 4,843,806, a decrease of 30,720 from the previous week. There were 6,273,508 persons claiming benefits in all programs in the comparable week in 2012. Extended Benefits were available only in Alaska during the week ending April 27.
According to the BLS, 11,659,000 persons were officially considered unemployed in April, with 4.35 million ""long-term"" unemployed that is, out of work for at least 27 weeks. Of those individuals counted as unemployed, 6.82 million were not receiving any form of government unemployment insurance for the week ended April 27, up from 6.78 million one week earlier.
States continue to borrow from the federal government to cover shortfalls in those funds, which will eventually have to be repaid--unless Congress intervenes--with higher assessments on employers.
Since those assessments are a percentage of payrolls, they discourage employers from adding new workers. As of May 14, 22 states had borrowed a total of $21.6 billion. One week earlier, 24 states had an aggregate $23.5 billion in outstanding loans to cover shortfalls. Five states --California, Indiana, New York, North Carolina and Ohio--each owe more than $1 billion, which may require higher unemployment premiums or special assessments on employers in those states.
According to the Labor Department detail, also reported on a one-week lag, the largest increases in initial claims for the week ending May 4 were in Georgia (+2,212), New Mexico (+1,539), Kentucky (+892), Tennessee (+668), and Ohio (+552), while the largest decreases were in Connecticut (-1,434), New Hampshire (-867), Massachusetts (-756), Wisconsin (-730), and Rhode Island (-702).
_Hear Mark Lieberman Friday on P.O.T.U.S. radio, Sirius-XM 124, at 6:20 am Eastern Time._