NEW YORK (Reuters) - The number of Americans filing new claims for unemployment benefits fell for a third straight week last week, but still remain too volatile to offer a clear signal on labor market conditions.
Initial claims for state unemployment benefits dropped 25,000 to a seasonally adjusted 370,000, the Labor Department said on Thursday. The prior week’s figure was revised to show 2,000 more applications than previously reported. Last week’s drop brought them back to their pre-superstorm Sandy’s 360,000-370,000 range. Economists polled by Reuters had forecast claims falling to 380,0000 last week.
TERRY SHEEHAN, STONE & MCCARTHY RESEARCH ASSSOCIATES, PRINCETON, NEW JERSEY
“Jobless claims were down three weeks in a row. Clearly the storm effects have abated. We’re returning to the pre-storm trend level. It speaks to little change in the underlying labor market. We’re going to see this slow drawdown in new jobless claims and the unemployment rate will work its way down. We forecast 7.9 percent November unemployment and payroll growth of 75,000 jobs overall, based on the impact of the storm and the closure of the Hostess brand.”
RYAN SWEET, SENIOR ECONOMIST, MOODY‘S ANALYTICS, WEST CHESTER, PENNSYLVANIA
”Claims are very choppy from the hurricane distortions working through the system. The effect from the storm does seem to be temporary. We are not going to get clean readings on claims for several more weeks. We also have the typical year-end holiday distortions.
“Businesses are nervous about the fiscal cliff but they are not in a panic. They are in a holding pattern. They are not hiring or firing. This is actually a reason for optimism. If we make it past the fiscal cliff, hiring might pick up.”
RUSSELL PRICE, SENIOR ECONOMIST, AMERIPRISE FINANCIAL, TROY, MICHIGAN
”Initial claims are settling back into their pre-Sandy levels. So the negative impact from the spike that we experienced after hurricane Sandy is abating.
“It’s a little bit too early (to forecast December) but it does give us a positive trend that claims have now fallen for four straight weeks and it’s a positive indicator that the labor market is remaining fairly solid although certainly not robust by any means.”
AVERY SHENFELD, CHIEF ECONOMIST, CIBC WORLD MARKETS, TORONTO
”U.S. jobless benefit claims reports have been ‘rained out’ by the fallout from Hurricane Sandy of late, and while that impact is fading, the early timing of the Thanksgiving holiday could still be adding some volatility, although the government didn’t cite anything unusual in the report.
“The latest week showed an easing to 370,000, a bit better than expected and down from a nearly unrevised 395,000. That’s still in very mediocre territory in terms of its implications for job creation, and close to the pre-storm trend. ”
HUGH JOHNSON, CHIEF INVESTMENT OFFICER OF HUGH JOHNSON ADVISORS LLC IN ALBANY, NY
”First of all, the news was good news. The declining claims was generally more than expected. But it’s very hard to forecast week to week changes in claims so the fact that it was more than forecast is not a big surprise and not a market mover.
“The second reason, of course, is that everybody is thinking about other things. They are thinking about the employment report tomorrow which will be more important, and thinking about the ‘Thelma and Louise’ plan, which is even more important. So unfortunately our focus is on other issues right now.”
PAUL ZEMSKY, HEAD OF ASSET ALLOCATION, ING INVESTMENT MANAGEMENT, NEW YORK
”It’s important to see the number falls back to the range.
“Everyone was saying that claims had gone up because of Sandy, so it’s comforting when you get the confirmation. No additional weakness in the economy is showing up in jobless claims.”
PIERRE ELLIS, SENIOR GLOBAL ECONOMIST, DECISION ECONOMICS INC., NEW YORK
”They are restored back to levels before the storm. We could reasonably assume there is no underlying deterioration or acceleration in the labor market before the storm.
“We should still have a relative poor payroll reading tomorrow, but we should have some confidence that payrolls would bounce back in December.”
U.S. jobless claims, year-to-date link.reuters.com/xew34t
Americas Economics and Markets Desk; +1-646 223-6300