Jobless claims fall but experts say labor market cooling
December 6, 2000
WASHINGTON (AP) The number of Americans filing new claims for state unemployment insurance fell last week but still hovered at a level suggesting that the economy’s hunger for an ever-increasing supply of new workers is easing.
The Labor Department reported Thursday that new claims for jobless benefits dropped by 9,000 to a seasonally adjusted 352,000 for the week ending Dec. 2. That was the lowest level since Nov. 18.
Many analysts were expecting jobless claims to rise.
The more stable four-week moving average of jobless claims, which smoothes out week-to-week volatility, rose to 345,250, the highest point since July 18, 1998, when claims were at 355,250.
The Federal Reserve has raised interest rates six times since June 1999 to slow the high-flying economy enough to keep inflation in check but not so much as to cause a recession.
The economy slowed dramatically in the third quarter, growing at an annual rate of 2.4 percent, compared with the sizzling 5.6 percent rate registered in the second quarter.
As the economy continues to moderate, many economists believe that the nation’s unemployment rate in November will rise to 4 percent from October’s 30-year low of 3.9 percent. The government releases the employment report Friday.
Although the red-hot labor market has been cooling a bit in recent months, businesses are still struggling to find qualified workers to fill openings.
While that’s good for workers, economists are always watchful for signs that the so-called tight labor market will trigger wage and price inflation.
They worry that wages and benefits could rise too sharply as employers struggle to recruit and retain workers. That has not happened yet.
For the work week ending Nov. 25, 42 states and territories reported decreases in new jobless claims, while 11 reported increases, the jobless report said. That information lags a week behind the national figures and is based on seasonally unadjusted claims data.
The state with the biggest decline was California, down 18,823. Officials attributed that to fewer layoffs in agriculture, construction, trade and services.
Other states with big decreases: Texas, 5,289; Alabama, 4,203; Missouri, 4,031 and North Carolina, 3,825.
The state with the biggest increase in claims was Wisconsin, up by 16,919. Officials blamed the rise on layoffs in the transportation, construction, service, mining and manufacturing industries.