In March, employers took 2,933 mass layoff actions involving 299,388 workers, the highest levels on record. Mass layoff events increased by 164 from February, and initial claims increased by 3,911. Twenty-six states reached program highs for March in terms of average weekly initial claims.
Additionally, new jobless claims rose more than expected last week. Both figures are fresh evidence layoffs persist amid a weak job market that is not expected to rebound anytime soon.
The Labor Department said today that initial claims for unemployment compensation rose to a seasonally adjusted 640,000, up from a revised 613,000 the previous week. That was slightly above analysts’ expectations of 635,000. The number of workers continuing to filing claims for unemployment benefits topped 6.1 million.
Jobless claims have historically peaked six to 10 weeks before recessions end. Initial claims reflect the level of job cuts by employers. However, the latest report shows job losses remain high. The four-week average of claims, which smooths out volatility, dropped slightly to 646,750, about 12,000 below the peak in early April.
In another sign of labor market weakness, the number of people continuing to claim benefits rose to 6.13 million, setting a record for the 12th straight week. As a proportion of the work force, the total jobless benefit rolls are the highest since January 1983. The continuing claims data lag initial claims by a week. The high level of continuing claims is a sign that many laid-off workers are having difficulty finding new jobs.
Employers have cut 5.1 million jobs since the recession began in December 2007 in an effort to slash costs as consumers and businesses have sharply reduced spending. The department said earlier this month that companies cut a net total of 663,000 jobs in March, sending the unemployment rate to 8.5 percent, the highest in 25 years.
The cuts reflect the depth of the downturn, which has been global in scope. The International Monetary Fund estimated Wednesday that the global economy would shrink 1.3 percent this year, the first drop in more than six decades. The IMF projects the U.S. economy will decline 2.8 percent, the worst since 1946.
Among the states, Florida saw the largest increase in claims with 9,303 for the week ending April 11, which it attributed to more layoffs in the construction, service and manufacturing industries. The next largest increases were in Pennsylvania, California, Wisconsin and New York.
Michigan saw the largest drop in claims with 12,566, which it said was due to fewer layoffs in the automobile industry. The next biggest declines were in North Carolina, Missouri, Kentucky and Oregon.
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