Unemployment Numbers: Told You Not to Get Too Excited
Initial claims for state unemployment insurance rose 17,000 to 474,000 last week, the Labor Department said on Thursday, after five straight weeks of declines.
Analysts polled by Reuters had forecast claims climbing but only to 460,000. A Labor Department economist said claims had been bumped up by seasonal industries laying people off and by applications that had been held back during the Thanksgiving holiday week.
A separate report from the Commerce Department showed the nation's trade deficit in October shrank 7.6 percent to $32.9 billion. Analysts had expected the gap to widen to about $36.8 billion.
"Overall we are in an environment where layoffs are abating but people who were fired are still having a difficult time in finding jobs. The trade deficit is worth a couple of tenths" for fourth-quarter economic growth, said Tom Porcelli, senior economist at RBC Capital Markets in New York.
U.S. stock index futures trimmed gains on the claims data, while the dollar fell against the euro.
The labor market, considered the missing link in the economy's recovery from the most crippling recession since the 1930s, is slowly healing. Government data last week showed employers cut a mere 11,000 jobs in November.
And here I thought we were in a recovery. I guess it goes to show that you can't always trust what you read from government-issued reports.
Now that it has been demonstrated that the Fed has failed miserably in both mandates of price stability and maximum employment, can we pull the plug or what? Or is some DC PR team going to somehow make 10% unemployment appear "maximum"?