Newspaper article THE JOURNAL RECORD

New Jobless Claims Reveal Skepticism of Recovery

Newspaper article THE JOURNAL RECORD

New Jobless Claims Reveal Skepticism of Recovery

Article excerpt

WASHINGTON (AP) _ The number of Americans filing new unemployment claims remained frozen at 421,000 in late August, the government said Thursday, in a sign that employers, skeptical about whether a recovery has taken hold, are still letting workers go.

In other weak economic news, the productivity of American workers rose a mediocre 0.5 percent at an annual rate in the second quarter _ a much weaker performance than first believed _ and business investment plans were at a five- year low.

Also, the nation's leading retailers reported that the consumer spending slump extended into the back-to-school shopping season, a time when the sales pace usually accelerates.

The numbers add up to an economy that has failed to make much headway toward recovering from the recession, analysts said.

"In past recoveries, `shot out of a cannon' is a typical phrase for describing the economy. What's happening here is `crawling out of a hole,'

" said Allen Sinai, chief economist at the Boston Co.

The jobless claims report, which offered no encouraging news on the hiring front, may mean equally bleak numbers in Friday's unemployment report for August, analysts said.

In advance of the report, most analysts predicted the jobless rate probably inched up to 6.9 percent from July's 6.8 percent. A separate survey of business establishments, analysts predicted, will probably show that the economy added relatively few jobs last month.

Thursday's jobless claims report from the Labor Department showed that for the week ending Aug. 24, the number of Americans filing new applications for unemployment benefits failed to improve, holding at the 421,000 level from the previous week.

Rather than falling, as would be consistent with a recovery, the jobless claims number has actually crept up, on average, over the past month, analysts noted.

The latest four-week average of new jobless claims is at 420,000; a month ago, it was 406,000, according to analysts who calculate the four-week average from the Labor Department statistics.

"The recovery isn't strong enough, and convincing enough, to employers that they're willing to go out and add to their labor force. …

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