Jobless Benefits Claims Back Above 400,000:
The jobs problem in the U.S is still a massive issue.
The number of Americans seeking benefits for unemployment is back above the 400,000 level which seems to remain a sticky benchmark. There was some excitement last week when jobless benefits dipped below 400,000 but we believed this number would be revised upward and that unemployment would rise above this level.
The Labor Department said today, jobless benefits claims fell by 1,000 and revised last week’s number from 398,000 to 401,000 leaving the total seasonally adjusted rate at 400,000.
The four-week average of jobless benefits claims is slightly above 407,000 and the downward trend still has not been solidified. The lagged effects of the prolonged debt ceiling debate may also have a deleterious effect on the economy in a few months.
We are waiting for more real evidence that the economy is strengthening and are not relying on yesterday’s ADP report for directional guidance without more supporting data. ADP announced yesterday that jobs grew by 114,000 in July but this would still not be enough to jump-start the economy.