The number of newly-laid off workers seeking unemployment insurance fell last week, the federal government said today, fresh evidence that layoffs are easing.

Advertisement

The Labor Department said initial claims for jobless benefits dropped to a seasonally adjusted 550,000 for the week ending Aug. 1, down from an upwardly revised figure of 588,000 in the previous week.

That’s much lower than analysts’ estimates of 580,000, according to a survey by Thomson Reuters. The four-week average of claims, which smooths out fluctuations, dropped to 555,250, its lowest level since late January.

Tommy McKnight, the manager of the Employment Security Commission/JobLink office in Roanoke Rapids, noted he had seen a slight decline in the number of applicants and a rise in the number of jobs. “But it is way too early to tell if this is a trend,” he said.

McKnight reports 158 clients found jobs through the Roanoke Rapids Employment Security Commission/JobLink in July. ESC/JobLink processed 735 applications for employment during the month.  The unemployment rate for Halifax County is 14.6 percent compared with a statewide rate of 11.1 percent.  Northampton County’s rate is 11.2 percent.

Nationally, the tally of people continuing to claim benefits rose, however, by 69,000 to 6.3 million, the department said, after dropping for three straight weeks. The continuing claims data lags initial claims by a week.

North Carolina had the largest drop in claims, with 9,809, which it said was due to fewer layoffs in the textile, furniture, rubber and plastics, and industrial machinery industries.

Many economists expect initial claims to continue to decline this year.

“Claims should fall over the next few months, as the economy appears more or less to have stabilized,” Ian Shepherdson, chief U.S. economist at High Frequency Economics, said in a note to clients before the department’s report.

When emergency extensions of unemployment are included, the total rolls climbed to a record 9.35 million for the week ending July 18, the most recent data available. Congress has added up to 53 extra weeks of benefits on top of the 26 typically provided by the states.

The increase in the number of people continuing to claim benefits is a sign jobs remain scarce and the unemployed are having difficulty finding new work.

Despite the improvement, weekly jobless claims remain far above the 300,000 to 350,000 analysts say is consistent with a healthy economy.

The recession, which began in December 2007 and is the longest since World War II, has eliminated a net total of 6.5 million jobs. The unemployment rate is expected to rise to 9.6 percent when the July figure is reported Friday. The jobless rate of 9.5 percent in June marked a 26-year high.

Among the states, Ohio had the biggest increase in claims, with 891, followed by Oklahoma, Mississippi, Louisiana and Alaska. State data lags behind initial claims data by one week.

Michigan, Florida, Georgia and Alabama had the next largest declines.