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U.S. jobless claims up
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October 18, 2001: 10:10 a.m. ET
The number of new claims for unemployment benefits rose last week.
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NEW YORK (CNNmoney) - New claims for unemployment benefits in the United States rose last week, the government said Thursday, as job cuts from last month's terrorist attacks continued to filter through the U.S. economy.
The Labor Department said new claims for state jobless benefits rose to 490,000 in the week ended Oct. 13 from a revised 484,000 the prior week. Economists surveyed by Briefing.com expected new claims of 485,000.
The weekly jobless claims data typically are volatile. The four-week moving average, which smoothes out fluctuations in the weekly data, rose to 491,250 from a revised 467,000 the prior week.
Continuing claims for workers who have received at least a week of benefits rose to 3.65 million for the week ended Oct. 6, the latest data available, from a revised 3.50 million the previous week.
U.S. stock markets fell in early trading, mostly in reaction to new reports of anthrax exposure in the United States. U.S. Treasury bond prices were little changed.
The labor market had been weakening in 2001 as a year-long slowdown in business spending had hurt the economy and corporate profits, leading to hundreds of thousands of job cuts. The pace of layoffs accelerated after the terror attacks on the World Trade Center and the Pentagon on Sept. 11.
"Labor markets are deteriorating rapidly. Layoffs remain at a fast pace, while hiring has all but stopped," said Steven Wood, economist with FinancialOxygen. "As economic activity continues to unravel, there are few prospects for a near-term turnaround. The national unemployment rate, now at 4.9 percent, should breach 6 percent before the economy begins to recover."
Many economists expect the rate of unemployment in the United States to rise above 5.0 percent in October. U.S. employers cut more jobs in September, the government said, than in any month since February 1991, when the economy was in recession and the United States was fighting the Gulf War.
To keep consumers spending and the economy afloat, the Federal Reserve has cut its target for short-term interest rates nine times this year -- twice since the attacks -- to their lowest levels in nearly 40 years. Economists widely expect it to cut rates again at its next policy meeting, scheduled for Nov. 6, four days after the Labor Department reports on October unemployment. 
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