Unemployment Claims Jump During Week of Government Shutdown

Thursday, 10 Oct 2013 03:16 PM

By Clyde Hughes

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Unemployment claims during the first week of the federal government shutdown jumped to 374,000, an increase of 66,000 from a week earlier, according to the U.S. Department of Labor statistics.

The labor department reported the largest unemployment claims came from Puerto Rico (1,105), Oregon (1,104), California (1,045), Pennsylvania (736), and Missouri (561). Claims for benefits filed by former federal civilian employees totaled 1,391, an increase of 359 from the prior week.

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CNN Money reported that the unemployment benefits jump was the largest one-week rise since November 2012, when claims surged by 88,000 in the week following Superstorm Sandy. 

Discharged veterans filed 2,098 initial claims for unemployment insurance, down 52 percent from the previous week, according to labor department statistics. States reported 1.4 million people claimed emergency unemployment compensation benefits for the week ending September 21, a decrease of 27,543 from the prior week.

The Associated Press reported that a government spokesman said processed applications in California were delayed several weeks because of a computer upgrade. One-quarter of the increase was from government contractors and other workers affected by the shutdown. 

Before last week, unemployment applications had declined steadily over the past three months, a sign companies were cutting fewer workers.

Some moves by the federal government helped save those jobs. For example, Lockheed Martin told the AP Monday that it had furloughed about 2,400 employees, rather than the 3,000 employees the company initially said it would furlough, because Defense Secretary Chuck Hagel recalled most of the Pentagon's civilian employees to work.

The Associated Press reported that analysts had forecasted the economy would grow slowly before the shutdown. Many of them predicted economic growth would be between 1.5 percent and 2 percent for July through September.

Some economists hope for an annual economic growth of 2.5 percent to 3 percent from October through December.

"The broader picture is still that labor market conditions are improving, albeit not quite as much as we previously thought," Paul Ashworth, chief U.S. economist for Capital Economics, said in a research note, according to CNN Money.

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Related stories:

Jobless Claims Fall as Reading Clouded by Processing Snafu

Furloughed Federal Workers Claim Unemployment Benefits

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