Following a slight decrease in initial jobless claims for the week ending Dec. 13, claims last week fell a sharp 94,000, bringing the total seasonally adjusted amount of initial claims to 492,000, the U.S. Department of Labor reported Wednesday
. The drop is shockingly the largest in 16 years.
Continuing claims -- declared by workers who have collected benefits for more than a week -- on the other hand, rose 140,000 to 4,506,000, which is the highest level since December of 1982, according to Market Watch
. The insured unemployment rate also eased upward from 3.4 percent from last week's 3.3 percent.
Officials are attributing the unexpected plunge in overall initial claims to seasonal volatility. A labor department official told Reuters
that "the numbers seemed unbelievable but the states certified they were correct."
Economists surveyed by Dow Jones Newswires had only predicted claims would drop by 11,000 last week, according to a Wall Street Journal report.
Also contrary to the Labor Department's findings, analysts polled by Reuters expected a jump in first time claims -- forecasting the total number of claims would mount 565,000. It's worth noting, however, despite the plunge, the level of claims is still 45 percent higher than last year at this time.
The largest increases in initial claims were seen in California -- where 20,866 people filed a claim -- Kentucky, Michigan, Missouri and Indiana. But last week brought good news for Massachusetts, Georgia, New Jersey, Tennesse and Illinois who experienced the largest decreases in first time claims; unless, of course, unemployed individuals in those states are just failing to file unemployment claims.
The four-week moving average of new jobless claims, which can sometimes paint a better picture of long-term unemployment trends, was 552,250 last week, a decrease of 5,750 from the previous week's unrevised average of 558,000, Wednesday's data said.
Nonetheless, the labor market is still suffering from a troubled economy -- one that shed an unbelievable 533,000 jobs in November. We can only hope 2009 has some better luck in store for our ailing job market.
Kelly Curran at email@example.com