Thursday, October 13, 2011

Applications for unemployment aid barely changed as American works remain idle

The number of people applying for unemployment benefits fell slightly last week, a sign the job market isn't getting much better.

Applications ticked down by 1,000 to a seasonally adjusted 404,000, the Labor Department said Thursday.

The four-week average declined for the third straight week to 408,000. That's the lowest average in eight weeks.

Still, applications are higher than they would be in a healthy economy. They need to fall consistently below 375,000 to signal sustainable job growth. They haven't been below that level since February.

The report suggests that layoffs have declined in recent weeks. But other data show hiring hasn't picked up.

Ellen Zentner, senior economist at Nomura Securities, said applications around 400,000 indicate a neutral job market, "one that's neither picking up, nor deteriorating."

Only a few weeks ago some had feared the risks of another recession had grown. So "even neutral readings are good," she said, because they signal that conditions aren't worsening.

Employers pulled back on hiring this spring, after rising gas prices cut into consumer spending and Japan's March 11 earthquake disrupted supply chains, which slowed U.S. auto production. more