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Jobless claims rise slightly, showing hiring at sluggish pace

CNBC's Rick Santelli breaks down the latest weekly unemployment numbers and discusses its impact on the markets and economy, with CNBC's Steve Liesman.

The number of Americans filing for jobless benefits rose slightly in the latest week, indicating a labor market that remains in the doldrums.

The Labor Department reported that new claims rose a seasonally-adjusted 4,000 to 367,000, while the four-week moving average, considered a more accurate gauge of labor market conditions, was flat at 375,000.

The data came a day after President Barack Obama and former Massachusetts Gov. Mitt Romney squared off in their first debate, which focused mostly on the economy, and a day before the crucial monthly employment report from the government.

The level of jobless claims in the latest week indicates only modest hiring, far below the levels needed to put a dent in the 8.1 percent unemployment rate.

"They are not very inspiring. It is a very marginal reversal of last week's marginal declines. This suggests that the trend is still looking fairly stable. The labor market is improving but it is not really gathering direction for better or worse, it is still just plodding along," said economist Sean Incremona at 4Cast Ltd.  

Economists polled by Reuters had forecast claims rising to 370,0000 last week. It was the first time since December last year that the four-week average was unchanged.

A Labor Department official said there were no special factors influencing the report and no states had been estimated.

'Discouraged' workers face tough road back to employmentDespite fears of tighter fiscal policy next January, there is little sign that companies are responding by laying off workers on a wide scale.

 

Last week's claims data fell outside the survey period for the September employment report, but applications dropped 18,000 from the first week of the month, signaling some improvement in the pace of job creation last month.

Employers are expected to have added 113,000 jobs to their payrolls in September, an increase from 96,000 in August, with the unemployment rate edging up by a tenth of a percentage point to 8.2 percent, according to a Reuters survey of economists.

The anticipated modest improvement in labor market conditions has also been telegraphed by increases in measures of manufacturing and service sector jobs in September. In addition, payrolls processor ADP on Wednesday reported better than expected private sector jobs gains in September.

Worries over the so-called fiscal cliff - automatic tax hikes and government spending cuts that will suck about $600 billion out of the economy next year if lawmakers fail to agree how to slash the budget deficit - are making businesses cautious about ramping up hiring.

The claims report showed the number of people still receiving benefits under regular state programs after an initial week of aid was unchanged at 3.28 million in the week ended September 22. It was the first time since December last year that so-called continuing claims were unchanged.

Reuters contributed to this report.
 

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