| Ed Lynch Saturday, April 13, 2013 |
According to the Associated Press, the number of Americans who applied for unemployment benefits saw a big decrease last week. The number of Americans that sought the benefits fell nearly 42,000 last week, which means that there may be a spike in hiring as well. A spike in hiring is a good sign of economic upturns, which is something that people have been waiting on and looking for.
The decline in numbers reversed a incline that had been seen over the last three weeks. If you average the numbers together, however, it is not so damaging, as it may seem with the numbers only rising 3,000 to 358,000. This number is much less than the highest level that was seen, which may be a light on the horizon as far as the economy.
A spokesman from the Labor Department attributes the increase to the Easter holiday. Due to it being changed from year to year, it is hard to adjust the numbers for school holidays and other changes that make up temporary layoffs. Seasonal adjustments could explain some of the issue, if it was possible to pin down a regular date for the Easter holiday.
Applications rose two weeks ago to 388,000, which is the highest level in four months. According to Jim O’Sullivan, chief U.S. economist at High Frequency Economics, said that the spike “appears to have been a false alarm.” This quote was release in a note to his clients. He went on to say, “The report should assuage some of the concerns raised by last week’s weaker-than-expected data, particularly payrolls.”
In March, only 88,000 jobs were added, which is a huge decrease over the four month average of 220,000. However the drop in unemployment applications could be a sign that hiring is picking up in April, which will mean an additional drop in applications and in unemployment claims.
Keeping a watch on the unemployment application numbers aids economists in determining how the economy is faring. While this news is encouraging, it is important that it is monitored further to see if it is a trend or just a blip on the screen.
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