(Bloomberg News) The number of claims for U.S. unemployment benefits unexpectedly rose last week, pushed up by auto-plant shutdowns and other unusual events that seasonal variations failed to take into account, the Labor Department said.
Applications for jobless benefits jumped by 43,000 to 474,000 in the week ended April 30, the most since August, Labor Department figures showed today. A spring break holiday in New York, a new emergency benefits program in Oregon and auto shutdowns caused by the disaster in Japan were the main reasons for the surge, a Labor Department spokesman said as the data was released to the press.
Even before last week, claims had drifted up, raising concern the improvement in the labor market has stalled. Employers added 185,000 workers to payrolls in April, fewer than in the prior month, and the unemployment rate held at 8.8%, economists project a Labor Department report to show tomorrow.
"We're seeing so many distortions in the claims numbers week to week that it's hard to say, but I'm willing to be patient and wait and see," said Stephen Stanley, chief economist at Pierpont Securities LLC in Stamford, Conn. "Other reports show an improvement in the labor market. It's going to take a while to dig out of the hole we have in relation to the jobs the economy lost during the recession."
Futures Fall
Stock-index futures dropped after the report. The contract on the Standard & Poor's 500 Index maturing in June fell 0.6% to 1,334.8 at 8:58 a.m. in New York. Treasury securities rose, sending the yield on the benchmark 10-year note down to 3.18% from 3.22% late yesterday.
Economists forecast 410,000 claims, according to the median estimate in a Bloomberg News survey. Forecasts ranged from 395,000 to 450,000 in the survey of 46 economists. The Labor Department revised the prior week's figure up to 431,000 from an initially reported 429,000.
A spring break holiday at schools in the state of New York prompted workers to file claims, which the seasonal adjustment factors didn't expect last week, the Labor Department official said. In addition, Oregon began a new emergency benefits program for the long-term unemployed that also pulled in some new claimants, he said. Finally, auto plant shutdowns due to parts shortages caused by the earthquake and tsunami in Japan also contributed to the increase, the official said.
The spokesman also said that any claims filed by workers throughout the South that lost their jobs due to the storms that spawned tornados would probably be reflected in a different set of data rather than in the initial claims figures.
Productivity Cools