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January 16, 2009
WASHINGTON - The number of newly laid-off workers seeking unemployment benefits rose more than expected last week.
The Labor Department said Thursday that first-time requests for unemployment insurance jumped to a seasonally adjusted 524,000 last week, above analysts' expectations of 500,000 new claims. The increase is partly caused by a flood of requests from newly laid-off people who delayed filing claims over the holidays, a Labor Department analyst said.
Companies from a range of industries announced more job cuts Thursday. MeadWestvaco Corp., which makes paper and plastic products, said it will lay off about 2,000 employees, about 10 percent of its work force, as it accelerates cost savings. Software company Autodesk Inc. said it is cutting 750 jobs, or about 10 percent of its employees, as it prepares to report a fourth-quarter loss.
On Wednesday, Google Inc. said it was closing three engineering offices and cutting 100 recruiters as the recession dampens hiring. Computer-equipment maker Seagate Technology LLC said it will eliminate 2,950 jobs, or 6 percent of its work force.
The rise in initial jobless claims came after two weeks of declines that economists said largely reflected holiday-related distortions in the data. Analysts have said retailers did not hire as many temporary seasonal workers this year, because of the recession, and thus there weren't as many subsequent layoffs as in past years.
But the jump in last week's numbers, combined with the new layoffs, could signal the resumption of an upward trend in claims that was evident last year.
Ian Shepherdson, chief U.S. economist for consulting firm High Frequency Economics, said in a research note that claims could reach 750,000 later this year.
"The experience of previous deep recessions suggests claims are nowhere near their peak, and we doubt that peak will be reached before the fall of this year," he said.
Other companies that have announced layoffs recently include pharmaceutical company Pfizer Inc., mobile-phone maker Motorola Inc., and industrial conglomerates Textron Inc. and Cummins Inc.
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