The number of U.S. workers filing initial claims for jobless benefits unexpectedly rose last week to the highest since early January, and part of the gain may reflect difficulties making seasonal adjustments, the Labor Department said today.
First-time applications rose to 350,000 last week, the highest since the week that ended Jan. 8, from 330,000. A department spokesman in Washington said statisticians anticipated a decline of 17,000 in unadjusted claims. Instead the decline was 380, pushing up the adjusted level. Moreover, the department revised figures going back to 1999.
Other figures point to a strengthening job market. The number of people continuing to claim jobless benefits declined during the month to a four-year low.
``We can see an upward blip in claims any given week, but I don't see such a blip being sustained because so many other economic indicators are so strong right now,'' Nariman Behravesh, chief economist at Global Insight Inc. in Lexington, Massachusetts, said before the report. ``We've got an economy that's growing at 4 percent, and that suggests we will continue to see improvement in the job market.''
The four-week moving average of claims, a less volatile indicator, rose to 336,000 from 327,500. The average was the highest since the week that ended Jan. 15.
The median estimate for jobless claims in a Bloomberg News survey of 36 economists was 320,000. Estimates ranged from 314,000 to 335,000.
The U.S. economy created 262,000 jobs in February, the most in four months, and is expected to add 220,000 this month, according to the median estimate in a Bloomberg survey of economists. The unemployment rate is forecast to drop to 5.3 percent from 5.4 percent.
Continuing Claims
The Labor Department is scheduled to release the jobs report tomorrow at 8:30 a.m. in Washington.
The number of people continuing to collect state jobless benefits dropped to 2.608 million in the week that ended March 19, the lowest since April 2001, from 2.674 million the week earlier. The four-week average of continuing claims dropped to 2.656 million from 2.671. That average also was at a four-year low.
The insured unemployment rate, which tends to track the U.S. jobless rate, was 2.1 percent for the 10th straight week. Thirty- two states and territories had a decrease in claims, while 21 had an increase. Continuing claims, the insured unemployment rate and the state data are reported with a one-week lag.
Energy costs still pose a risk to job growth, although less than in 2004, economists said. Companies slowed the pace of hiring in the third quarter of last year, when oil futures climbed to a record. The price climbed even higher this month.
Hiring Plans
``If they do slow hiring, it won't be quite as pronounced this year because there are enough positives in the economy, like business confidence, to keep the labor market looking pretty good,'' according to Wesley Beal, chief U.S. economist at IDEAglobal.com in New York. ``It would take another $20 jump in oil prices to undermine the labor market.''
Oil futures on the New York Mercantile Exchange climbed March 18 to $56.72 a barrel, the highest in more than two decades of trading, from $42.12 at the start of the year.
Business investment, which helped push economic growth to 4.4 percent last year, has spurred hiring.
Great Plains Energy Inc. said yesterday it may add as many as 1,000 construction jobs and 100 permanent jobs the next four years as it builds a new coal-fired plant in the Kansas City, Missouri, area.
Midwest Airlines, a unit of Midwest Air Group Inc., will add 60 meal preparation jobs in Milwaukee by May 10 and 40 more positions in Kansas City this summer, Senior Vice President Carol Skornicka said. Midwest, based in Oak Creek, Wisconsin, is the 20th largest low-fare carrier in the U.S. by market capitalization.
Job Reductions
``This is a little different because we're insourcing at a time when many companies are outsourcing,'' Skornicka said. ``Our analysis showed that we could save more than $2 million a year by handling dining services internally.''
Nexus Health System Inc., a residential care provider for long-term, acute-care patients, plans to add 150 people to its 400- member workforce by July, the Houston-based company said this week.
They'll be employed at a new nursing home in North Houston that will boost the privately held company's beds from 120 to 174. The facility will be the fifth for the Houston-based company, which has annual revenue in the $50 million range, according to Chief Executive John Cassidy.
``We're expanding to meet the growing needs of baby boomer parents, who have been taking care of adult children with disabilities for their entire lives,'' Cassidy said. ``They can't do it as they get older.''
Cutting Positions
At the same time, companies are still cutting positions to save costs.
Delta Air Lines Inc., the third-largest U.S. carrier, plans to eliminate as many as 2,000 jobs and save $240 million over five years by outsourcing maintenance on about half its fleet. The change, announced this week, is part of the Atlanta-based company's effort to deal with reduced fairs, rising fuel prices, and increased competition from discount airlines.
Steelcase Inc., the world's third-biggest maker of office furniture, said March 28 it will close some plants in Michigan and eliminate 600 jobs. The Grand Rapids company's annual sales have fallen since 2001. The company says the moves are expected to save $35 million to $45 million a year before taxes.
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