Special Report Your Job

Auto industry sparks surge in jobless claims

Government says 637,000 people filed for first-time unemployment benefits last week. Continuing claims at all-time high for 15th week in a row.

EMAIL  |   PRINT  |   SHARE  |   RSS
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
By Ben Rooney, CNNMoney.com staff writer

Life on unemployment
6 readers tell their stories of making ends meet on $300 a week.

NEW YORK (CNNMoney.com) -- Auto industry job losses led to a surge in the number of people filing initial claims for unemployment benefits last week, according to a government report released Thursday.

And, in the most recent data available, the number of people filing claims on an ongoing basis rose to a record high for the 15th straight week.

A total of 637,000 people filed new claims for jobless benefits in the week ended May 9, the Labor Department said. That's an increase of 32,000 from an upwardly revised 605,000 in the previous week.

The tally was higher than expected. Economists surveyed by Briefing.com had forecast 610,000 initial claims.

The majority of last week's increase was due to layoffs and furloughs in the automotive industry, a Labor Department analyst said.

Chrysler LLC declared bankruptcy late last month and General Motors (GM, Fortune 500) is restructuring ahead of a government deadline at the end of May.

The 4-week moving average of initial claims, which smoothes out volatility in the measure, rose 6,000 to 630,500.

"It looks like we're getting some effect from the problems in the auto industry, and I think that's going to continue" said Michael Strauss, chief economist at Commonfund. "Away from that, the backdrop has improved."

Initial claims had trended lower in recent weeks, raising hopes that the labor situation was stabilizing and that mass layoffs were becoming less frequent.

But the weak economy continues to deter employers from hiring, as indicated by the increasing number of people filing jobless claims for multiple weeks.

In the week ended May 2, the most recent data available, 6,560,000 continuing claims were filed. That's the highest number since the Labor Department started tracking the data in 1967 and an increase of 202,000 from the previous week.

Since the recession began in December 2007, the economy has shed about 5 million jobs. The unemployment rate now stands at a 25-year high of 8.9%.  To top of page

They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
More Galleries
5 radical technologies that will change how you get to work From Uber's flying cars to the Hyperloop, these are some of the neatest transportation concepts in the works today. More
Royal wedding: How much will it cost? Meghan Markle's wedding to Prince Harry could cost millions once security is included in the bill. See how the costs break down. More
Robot co-workers? 7 cool technologies changing the way we work Experts believe humans and machines will work much more closely together. More
Worry about the hackers you don't know 
Crime syndicates and government organizations pose a much greater cyber threat than renegade hacker groups like Anonymous. Play
GE CEO: Bringing jobs back to the U.S. 
Jeff Immelt says the U.S. is a cost competitive market for advanced manufacturing and that GE is bringing jobs back from Mexico. Play
Hamster wheel and wedgie-powered transit 
Red Bull Creation challenges hackers and engineers to invent new modes of transportation. Play