Unemployment Claims Unexpectedly Drop to Lowest Level in 49 Years
Claims for unemployment benefits fell to their lowest level in over 49 years last week.
Initial claims for state unemployment benefits dropped to a seasonally adjusted 199,000 for the week ended Saturday, which was 13,000 less than the week before, the Labor Department reported on Thursday.
That figure represents the lowest level since mid-November 1969, when 197,000 applications were recorded.
The statistic is particularly impressive given the population in the United States was approximately 202 million in 1969 versus its current 325 million.
Reuters reported economists it had polled had forecast claims rising to 220,000, rather than dropping.
Additionally, the Labor Department noted the largest increases in jobless claims for the week ending Jan. 12 were in California (up 14,983), Texas (7,588), Kentucky (4,967), Florida (2,770) and Virginia (2,084), while the largest decreases were in New York (down 23,398), Georgia (4,655), Pennsylvania (3,955), Connecticut (3,086) and Alabama (2,274).
According to CNBC, economists expect the partial government shutdown will push the unemployment rate above 4.0 percent in January as hundreds of thousands of furloughed workers will be counted among the unemployed.
In December, the jobless rate rose two-tenths of a percentage point to 3.9 percent as long-term unemployed people came back into the labor market.
The Wall Street Journal reported that the jobless claims data comes against the backdrop of strong earnings reports by major U.S. companies and works to offset worries about trade tensions with China and of the partial government shutdown greatly impacting the economy.
“We haven’t seen a lot of indication that the weakness people are worried about is actually here yet,” said Jesse Rothstein, an economics professor at the University of California, Berkeley, in advance of Thursday’s claims report. “The fact that the jobless claims (number) has remained steady is an indication that these are still just concerns.”
Earlier this week, President Donald Trump trolled former President Barack Obama’s 2016 claim that the then-Republican candidate Trump would need a “magic wand” to bring manufacturing jobs back to the United States.
Trump tweeted on Monday, “The previous administration said manufacturing will not come back to the U.S., ‘you would need a magic wand.’ I guess I found the MAGIC WAND — and it is only getting better!”
“Last year was the best year for American Manufacturing job growth since 1997, or 21 years,” he pointed out.
Last year was the best year for American Manufacturing job growth since 1997, or 21 years. The previous administration said manufacturing will not come back to the U.S., “you would need a magic wand.” I guess I found the MAGIC WAND – and it is only getting better!
— Donald J. Trump (@realDonaldTrump) January 21, 2019
Earlier this month, the White House touted the December jobs report by the Bureau of Labor Statistics, which showed 312,000 positions were created, including 32,000 in manufacturing.
For the year, 284,000 manufacturing jobs were added, which is the most since 1997, according to the administration.
Trump’s top economic adviser, Larry Kudlow, has pointed to the unprecedented cut in regulations; the December 2017 tax reform law, which lowered the corporate income tax rate; and new trade policies for spurring strong economic growth, and thereby creating the strong jobs market.
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