Jobless claims drop, but remain high following Sandy

unemployment office, circa 1916

Seattle unemployment office, circa 1916. Image: Seattle Municipal Archives/Flickr/CC BY

The number of people filing unemployment claims for the first time fell dramatically during the week that ended November 17. The jobless claim numbers from the previous week were skewed high in the fallout of Hurricane Sandy’s destruction. However, the new number is still higher than the year’s average, indicating a jobs market that is continuing to struggle.

Jobless claims fall following record surge

In the week ended November 10, jobless claims rose by 90,000 and topped out at 451,000. That was immediately on the heels of the super storm Sandy, which hit the nation’s northeast in late October and destroyed thousands of businesses and homes alike.

However, the jobless claim numbers from the week ended November 17 showed a drop of 41,000, to a seasonally-adjusted 410,000 claims.

The number of new unemployment claims for the week ended November 17 was in line with the predictions of many top economists.

Claims surge in prior week

About 75,000 of the 90,000 added claims in the week ended November 10 were in New York and New Jersey, Pennsylvania and Connecticut, which are some of the states hit hardest by Sandy. It was the largest increase seen since Hurricane Katrina stuck the Gulf Coast in 2005.

Some of the decrease in claims for the week of November 17 represents workers retuning to jobs that had been on hold because of storm damage or loss of power.

Jobless numbers still skewing high

However, economists expect those numbers, still skewed high as a result of Sandy, will continue to decrease in the weeks to come. Claims remained high for a month after Hurricane Katrina, according to Market Watch.

In the previous months before Sandy, the nation averaged between 360,000 and 390,000 for first-time unemployment claims.

Jobs claims numbers posted early

Normally, the jobless claims numbers are released on Thursday. However, due to the Thanksgiving holiday, the Nov. 17 figures were announced a day early.

Consumer confidence holding

Meanwhile, a separate report indicates that consumers remain confident in spite of the month’s volatile jobless claims numbers. According to a monthly survey by Thomson Reuters/University of Michigan, October’s consumer confidence rating of 82.6 notched up to 82.7 in November.

However, the report also noted that concern over the impending “fiscal cliff” is beginning to color the attitudes of some consumers. That concern is likely to increase unless the president and Congress act quickly to resolve the problem before the end of the year.

Sources

CNBC

MarketWatch

Star Tribune

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