Jobless claims edge up 1,000 to 434,000

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WASHINGTON — The number of initial claims for state unemployment benefits was essentially unchanged in the week of Jan. 2, rising 1,000 to a seasonally adjusted 434,000 after dramatic declines the previous two weeks, the Labor Department reported Thursday.

The total number of people collecting unemployment
benefits of any kind, including extended federal benefits, rose by
518,100 in the week of Dec. 19 to 10.6 million, not seasonally adjusted.

The not-seasonally adjusted increase in total claims
was driven by the recent expansion of extended benefits under a new
federal law that allows up to 99 weeks of unemployment benefits to be
paid.

The number of people collecting under the extended
federal program rose by 620,000 to a record 5.5 million. Not all states
have their extended programs up and running yet.

In the regular state program, initial claims rose by
a seasonally adjusted 1,000 to 434,000 last week, the government agency
said, based on state-by-state reports from unemployment offices. The
previous week’s figure was revised higher by 1,000 to 433,000.

The four-week average of initial claims — often
favored by analysts because it smoothes out one-time distortions caused
by bad weather, holidays and strikes — fell by 10,250 to 450,250.
That’s the lowest since September 2008, just before the near-collapse of the financial system.

The number of people collecting regular state benefits fell by 179,000 in the week ending Dec. 26 to a seasonally adjusted 4.8 million, the lowest in nearly a year.

Compared with a year ago, initial claims are down 15 percent, while state continuing claims are up 13 percent.

Over the past several months, the jobless claims
data have flashed two somewhat contradictory messages: Fewer people are
losing their jobs than were six months ago, but once a job is lost,
it’s very hard to find another one.

In response to the recession, the federal government
is offering extended benefits to many of those who exhaust their state
eligibility, typically after 26 weeks. For the first time on record,
more than half of those who file an initial claim for benefits exhaust
their eligibility before finding work.

This is the period of the year with the largest
number of people collecting benefits, due to large numbers of seasonal
layoffs in retail, construction and other seasonal occupations. The
regular state data are adjusted for this seasonal expansion in
benefits, but the extended federal benefits are not seasonally adjusted.

Federal benefits are now available for up to 99
weeks in some parts of the country. As of November, about 5.9 million
people — 38 percent of the 15 million people officially classified as
unemployed—had been actively looking for work longer than six months,
the Labor Department reported separately.

The claims report comes one day before the Labor Department
reports on December nonfarm payrolls and unemployment rate. Economists
surveyed by MarketWatch look for payrolls to rise by 10,000, the first
increase in nearly two years. The unemployment rate is expected to rise
to 10.1 percent from 10 percent.

The monthly employment data are based on separate
surveys of businesses and households, and are not related to the number
of people claiming unemployment.

Those who exhaust their benefits or who are
ineligible to collect are still classified as unemployed if they are
actively looking for a job.

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Distributed by McClatchy-Tribune Information Services.

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