WASHINGTON – The number of Americans applying for new unemployment benefits fell last week but remained sharply higher than two weeks earlier because of Hurricane Harvey's effects.
Continue Reading Below
Initial jobless claims, a proxy for layoffs across the U.S., fell by 14,000 to a seasonally adjusted 284,000 in the week ended Sept. 9, the Labor Department reported Thursday. Economists surveyed by The Wall Street Journal had expected 305,000 new claims. This latest drop arrives after claims jumped to 298,000 in the week ended Sept. 2 from 236,000 a week earlier.
Ian Shepherdson, chief economist at Pantheon Macroeconomics, predicts the surge in Irma-related claims will show up in next week's report.
"Last week, people being evacuated in Florida or preparing to ride out the storm at home had better things to do than make jobless claims," Mr. Shepherdson said in a note to clients. "We expect a big increase next week, then a gradual decay over the next few weeks."
Claims have remained at historically low levels for several years, a sign of underlying health in the job market. But the flooding and destruction in Texas, Louisiana and Florida as a result of Hurricanes Harvey and Irma could cause significant job losses, at least temporarily.
Advance claims, not adjusted for seasonality, in both Texas and Louisiana, the two states the Labor Department noted as being affected by Hurricane Harvey, were both down from the previous the week.
Continue Reading Below
Despite rising after Hurricane Harvey, jobless claims have remained below 300,000 for 132 straight weeks, the longest such streak since 1970, when the U.S. population and workforce were far smaller than they are today.
Beyond the near-term noise, the economic impact of the hurricanes should come into focus over the coming weeks and months. Some forecasters have predicted the destruction caused by the storms will weigh on economic activity in the third quarter, but could boost growth in the fourth quarter as rebuilding efforts take shape.
More broadly, the temporary rise in jobless claims clouds the overall health in the U.S. labor market. The unemployment rate in August was 4.4%, the Labor Department reported earlier this month, hovering near a 16-year low.
Also Thursday, the Labor Department said the number of claims drawn by workers longer than a week fell 7,000 to 1.944 million in the week ended Sept. 2. Data on continuing claims are released with a one-week lag.
Write to Sarah Chaney at firstname.lastname@example.org
(END) Dow Jones Newswires
September 14, 2017 10:17 ET (14:17 GMT)