Archive for Thursday, February 19, 2009

627,000 file unemployment claims nationally last week; 5 million receiving unemployment

February 19, 2009


— The number of unemployed workers receiving unemployment benefits jumped to an all-time high near 5 million earlier this month, while new jobless claims remain well above 600,000. Both figures were worse than expected and new projections from the Federal Reserve show unemployment rising for the rest of this year.

The Labor Department reported Thursday that the number of people receiving regular unemployment benefits edged up to 4.99 million, marking the fourth straight week those receiving benefits have been at a record level.

The continuing claims figure underscores the difficulty people are having in this recession finding another job, which means they are forced to receive benefits for a longer period.

An additional 1.5 million people are receiving benefits under an extended unemployment compensation program approved by Congress last year, bringing the total number of people receiving unemployment benefits to 6.54 million for the week ending Feb. 7.

New applications for unemployment benefits totaled 627,000 last week, the same as the previous week, according to the department. But that was still more than the 620,000 claims economists expected.

It also remained near the 631,000 claims filed three weeks ago, which was the highest tally since October 1982, when the economy was emerging from a steep recession, though the labor force has grown by about half since then.

The cascade of layoff notices in recent weeks has heightened concerns about the current recession, already the longest in a quarter-century.

Goodyear Tire & Rubber Co., said Wednesday it will cut nearly 5,000 jobs, or almost 7 percent of the biggest U.S. tire maker’s work force, this year after it posted a fourth-quarter loss and revenue sank 21 percent. The cuts follow the elimination of about 4,000 jobs in the second half of last year.

General Motors Corp. and Chrysler on Tuesday filed plans with the government more than doubling their request for aid to a total of $39 billion and announced plans for thousands more job cuts. GM alone said it would cut 47,000 jobs globally by the end of the year — 19 percent of its work force, and Chrysler said it will cut 3,000 more jobs.

The Fed released a new economic forecast on Wednesday that reduced its growth forecast for 2009 and increased its unemployment rate projections. The new forecast predicts that unemployment will hit between 8.5 and 8.8 percent this year, up from the current level of 7.6 percent.

And in an appearance at the National Press Club, Fed Chairman Ben Bernanke said Wednesday that “strong and aggressive action” would be able to overcome the current recession and jolt the economy back into growth. But he said “if we fail ... then the situation will continue to deteriorate.”

President Barack Obama pointed to the deteriorating economy to win quick passage of an $787 billion economic stimulus program which he signed into law this week. On Wednesday, Obama unveiled a $75 billion program aimed at halting the surging level of mortgage foreclosures in the wake of the worst slump in housing in decades.


Use the comment form below to begin a discussion about this content.

Commenting has been disabled for this item.