US jobless claims fall but remain high after Harvey

US jobless claims fall but remain high after Harvey

File photo of a man looking over employment opportunities at a jobs centre in San Francisco, California. (REUTERS/Robert Galbraith)

WASHINGTON: Despite the damage from Hurricane Harvey in Texas new claims for US unemployment benefits fell in the latest week, keeping a historic streak of low levels unbroken, the Labour Department reported on Thursday (Sep 14).

New jobless claims surged to two-year high in the first week after the storm, but for the week ending Sep 9 claims fell to 284,000, seasonally-adjusted, down 14,000 from the prior week.

Harvey, which made landfall in the Gulf Coast region on Aug 26, was expected to fuel a surge in claims for jobless benefits, but the result was far below an analyst forecast for 310,000.

Claims remained below the symbolic bar of 300,000, where they have been for two and a half years, the longest stretch since 1970.

The less volatile four-week moving average rose 13,000 from the prior week to 263,250.

Officials said Hurricane Irma, which hit the US last weekend, caused government offices to close in Florida, Georgia and the US Virgin Islands, meaning results for those locations were estimated by the Labour Department.

In Puerto Rico, where Irma made an earlier landfall, weekly claims were "affected by Hurricane Irma," the Labour Department said, without elaborating. Claims on the island dropped more than 80 per cent for the week to 248, not seasonally-adjusted. Natural disaster or severe weather can delay people from filing for unemployment insurance.

With much of Houston underwater and the Gulf Coast oil and gas industry severely disrupted, analysts say Harvey will cause economic activity to drop sharply in the region before spiking as rebuilding gets underway.

Though they can see large swings from week to week, unemployment insurance claims can be used to gauge the prevalence of layoffs and the health of labour markets.

Analysts say that after seven years of uninterrupted job creation, employers are reluctant to lay off workers they may have difficulty replacing.

Source: AFP/de