WASHINGTON — A sign that jobs likely will stay scarce through next year emerged Thursday in a report showing a record number of Americans receiving jobless aid.
And plant shutdowns by Chrysler LLC and General Motors Corp. could further harm the economy in coming months.
Economists are just starting to assess the full impact of the auto industry’s woes, which affect thousands of suppliers and dealers.
The number of people continuing to receive jobless benefits rose to nearly 6.7 million from about 6.6 million, the Labor Department said. That’s the highest on record since 1967 and the 16th straight weekly record.
How many lost jobs?
New jobless claims fell to a seasonally adjusted 631,000 last week, down from a revised figure of 643,000 the previous week. First-time claims, which had dropped to 605,000 earlier this month, reflect the pace of recent layoffs.
But many economists said even though the number of layoffs are still likely declining, they may not be doing so as fast as previously appeared.
Meanwhile, the financial markets reacted sourly to the jobs report.
Auto closures kill jobs
Factory closings by Chrysler and GM, most of them temporary, probably will boost the number of jobless claims into the summer, economists said. The closings also are likely to cause layoffs at auto suppliers, which employ about 3 million workers.
"We expect that the auto shutdowns will be lifting claims for the next couple of months,” said Dean Maki, an economist at Barclays Capital.
Claims had jumped two weeks ago as Chrysler idled its factories after filing for bankruptcy protection. That move put up to 27,000 hourly employees out of work.
GM, meanwhile, is suspending work at 13 factories on a rolling basis over the next two months.
Joseph LaVorgna, chief U.S. economist at Deutsche Bank, said the closings could push weekly new claims higher.
Abiel Reinhart, an economist at JPMorgan Chase & Co., said the auto sector "won’t be a big enough drag to really change the big picture,” particularly since many of the layoffs are temporary.
But economists also acknowledged uncertainty about the impact.
by the associated press
And plant shutdowns by Chrysler LLC and General Motors Corp. could further harm the economy in coming months.
Economists are just starting to assess the full impact of the auto industry’s woes, which affect thousands of suppliers and dealers.
The number of people continuing to receive jobless benefits rose to nearly 6.7 million from about 6.6 million, the Labor Department said. That’s the highest on record since 1967 and the 16th straight weekly record.
How many lost jobs?
New jobless claims fell to a seasonally adjusted 631,000 last week, down from a revised figure of 643,000 the previous week. First-time claims, which had dropped to 605,000 earlier this month, reflect the pace of recent layoffs.
But many economists said even though the number of layoffs are still likely declining, they may not be doing so as fast as previously appeared.
Meanwhile, the financial markets reacted sourly to the jobs report.
Auto closures kill jobs
Factory closings by Chrysler and GM, most of them temporary, probably will boost the number of jobless claims into the summer, economists said. The closings also are likely to cause layoffs at auto suppliers, which employ about 3 million workers.
"We expect that the auto shutdowns will be lifting claims for the next couple of months,” said Dean Maki, an economist at Barclays Capital.
Claims had jumped two weeks ago as Chrysler idled its factories after filing for bankruptcy protection. That move put up to 27,000 hourly employees out of work.
GM, meanwhile, is suspending work at 13 factories on a rolling basis over the next two months.
Joseph LaVorgna, chief U.S. economist at Deutsche Bank, said the closings could push weekly new claims higher.
Abiel Reinhart, an economist at JPMorgan Chase & Co., said the auto sector "won’t be a big enough drag to really change the big picture,” particularly since many of the layoffs are temporary.
But economists also acknowledged uncertainty about the impact.
by the associated press
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