People@Work: Bright Spots Appear in a Lackluster Job Market
Thursday's latest figures on new unemployment claims showed fewer Americans than expected filed for first-time benefits in the week ended March 20 -- some 14,000 fewer than in the previous week, the Department of Labor reported. Further, the four-week moving average, a less volatile measure than week-to-week snapshots, fell by 11,000.
Initial claims have fallen for four consecutive weeks, although they were still above the 439,000 level recorded in early February. The decline is a "positive sign," says Moody's Economy.com economist Andrew Gledhill. "We're definitely not where we want to be," he says. "But we're headed in the right direction."
Of course, all eyes will be on this week's March Employment Situation Report, due out on Friday. Expectations are that the overall unemployment rate will hang steady at 9.7% and that the economy created 200,000 new jobs in March. While that might seem a paltry number, given that some 14.9 million Americans are out of work, it would be the first time employers created more jobs than were eliminated since last November. Prior to that, the last increase in nonfarm payrolls was recorded in December 2007, according to the Bureau of Labor Statistics. The economy shed 36,000 jobs last month.
Washington's Latest Moves May Be Having an Effect
Some analysts believe March may signal the start of a trend in monthly overall job creation. "We ought to see the first in what we believe is going to be a sustainable series [in rising] nonfarm payrolls," says Phil Orlando, chief equity market strategist at Federated Investors.
That trend may be helped in part by the first in what is expected to be a series of legislative actions to encourage hiring by employers. President Barack Obama last week signed into law a $17.6 billion jobs bill, which he says is a start in helping putting Americans back to work. The bill grants employers an exception from the 6.2% Social Security payroll contribution for each worker hired through the end of the year, as long as the employee has been out of work for at least 60 days. Further, businesses can take an additional $1,000 income tax credit for every new employee kept on the payroll for 52 weeks.
"While this jobs bill is absolutely necessary, it is by no means enough," Obama said in a signing ceremony at the White House. "There's a lot more that we're going to need to do to spur hiring in the private sector and bring about a full economic recovery."
Still unclear is what effect the legislation will have in creating jobs, especially for the nation's 4.8 million high school and college students, who will soon begin looking for summer employment. Teens and young adults are expected to have just as difficult a time finding seasonal employment as they did last year, often competing with seasoned older workers for the same jobs.
"It's not the summer to be choosy if you're a teen," says Shawn Boyer, CEO of SnagAJob.com, a website for those seeking hourly employment. "Just like last summer, employers have a wide range of [applicants] this year."