Jobless claims jump 9,000 in latest week

@CNNMoney June 23, 2011: 9:46 AM ET

NEW YORK (CNNMoney) -- The number of Americans filing for first-time unemployment benefits rose more than expected last week, remaining above the 400,000 mark for the 11th straight week.

There were 429,000 initial jobless claims filed in the week ended June 18, the Labor Department said Thursday. That was up 9,000 from the week before, and worse than the 413,000 claims economists surveyed by had expected.

While a level below 400,000 is typically associated with payroll growth, claims have remained above that mark since the beginning of April.

The four-week moving average of initial claims, calculated to smooth out volatility, was unchanged from the week before.

"Jobless claims remain elevated, and this will remain the limpest economic recovery since the Great Depression," said John Lonski, chief economist at Moody's Economy.

"This is telling us that we're not making much progress at bringing back the nearly 7 million jobs that have been lost since January 2008."

Lonski said the recent rise in jobless claims is partly due to higher energy costs, which have led to higher prices for consumers.

"Consumers are showing enough resistance to recent price hikes, so sales probably will be below expectations, inventories are mounting, and as a result employment is lower than otherwise," he said.

Unemployment will plague cities for years

Thursday's disappointing report comes a day after Federal Reserve Chairman Ben Bernanke issued a gloomy assessment of the economy, acknowledging a slowdown in economic growth and employment.

And while he insisted that a gradual recovery is still underway, investors were spooked by his comments, sending stocks lower. Declines in the stock market are also detrimental to the employment picture, since household wealth and spending are closely tied to the market.

"The recent past shows that the economy tends to stagnate whenever share prices fail to rise," said Lonski.

"Bernanke attempted to reassure financial markets that the U.S. economy would regain momentum, but this latest rise in jobless claims suggests markets will remain highly skeptical of his claim that a self-rejuvenation of economic activity is forthcoming."

Continuing claims -- which include people filing for the second week of benefits or more -- edged lower by 1,000 to 3,697,000 in the week ended June 11, better than forecasts for 3,680,000 ongoing claims.

No states saw jobless claims ease last week. Pennsylvania saw the biggest jump in unemployment claims, with 6,019 more people filing for jobless benefits. California and Texas followed -- with jobless claim increases of 3,884 and 3,333, respectively.  To top of page

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