Jobless Claims in U.S. Decrease More Than Anticipated

By Courtney Schlisserman

Feb. 11 (Bloomberg) -- Fewer Americans than anticipated filed claims for unemployment insurance last week as an administrative backlog subsided and indicating companies are nearing the end of major staff cuts as the economy recovers.

Initial jobless applications declined by 43,000 to 440,000 in the week ended Feb. 6, the lowest level in five weeks, from 483,000 the prior week, Labor Department figures showed today in Washington. The total number of people receiving unemployment insurance and those receiving extended benefits decreased.

The fastest pace of growth in six years last quarter means the economy may be poised to add jobs as companies restock shelves to keep pace with increased sales. At the same time, with an unemployment rate projected to average almost 10 percent this year, consumer spending may be slow to recover.

“Things have not really deteriorated,” said Stephen Gallagher, chief U.S. economist at Societe Generale SA in New York. “Unfortunately it doesn’t show much improvement either.”

Stock-index futures extended earlier gains after the report. The contract on the Standard & Poor’s 500 Index climbed 0.4 percent to 1,067.3 at 8:42 a.m. in New York. Treasury securities fell.

Less Than Anticipated

Economists forecast claims would fall to 465,000, from a previously estimated 480,000 for the week ended Jan. 30, according to the median of 47 projections in a Bloomberg News survey. Estimates ranged from 440,000 to 485,000.

The drop in applications represents the end of an ‘administrative backlog’ that built up when government offices were closed during the year-end holidays, a Labor Department spokesman said in a press conference. The current figures signal a return to a more “normal” level of claims, he said.

Continuing claims decreased to 4.54 million in the week ended Jan. 30, the fewest since January 2009. The continuing claims figure does not include the number of Americans receiving extended benefits under federal programs.

The number of people who’ve used up their traditional benefits and are now collecting extended payments dropped by about 171,000 to 5.68 million in the week ended Jan. 23.

The unemployment rate among people eligible for benefits, which tends to track the jobless rate, held at 3.5 percent in the week ended Jan. 30, today’s report showed. Thirty-six states and territories had an increase in claims for that same week, while 17 had a decrease.

Unemployment Declines

The unemployment rate in the U.S. unexpectedly dropped to 9.7 percent in January, while payrolls declined by 20,000, Labor Department figures showed Feb. 6. Manufacturers added to payrolls for the first time in three years and that may provide some spark to revive the rest of the labor market.

Even so, companies continue to cut staff.

United Parcel Service Inc., the world’s largest package- delivery company, said Feb. 8 it plans to furlough at least 300 pilots unless it can find more savings in a joint effort with the employees’ union. The company already is cutting 1,800 small-package jobs.

“Even though the economy has begun to turn around, UPS anticipates a very gradual recovery and a continued need for belt-tightening,” Bob Lekites, president of UPS Airlines, said in a statement.

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