Washington, Jan. 30 (Bloomberg) -- The number of U.S. workers filing new claims for state unemployment benefits last week rose by a small enough number to suggest the job market may be stabilizing. States received 397,000 applications for jobless benefits in the week that ended Saturday, the Labor Department said, compared with 383,000 a week earlier. It was the fourth straight week for claims to hold below 400,000, which many economists consider the dividing line between strength and weakness in the job market. Hiring may be slow to resume because executives, concerned about the threat of war in Iraq and slow economic growth, are trying to wring more work out of people still on payrolls. Unemployment this month is probably holding at an eight-year high of 6 percent, a survey of economists found, and soundings by the Federal Reserve this month turned up scant suggestion that companies are ready to expand. ``We're at this uneasy point where the layoffs have slowed but the hiring has not begun,'' said John Silvia, chief economist at Wachovia Corp. in Charlotte. ``This pace of economic growth is not enough to get firms to hire people.''
Economists had expected jobless claims to rise to 385,000 from an originally reported 381,000, based on the median of 33 forecasts in a Bloomberg News survey. The four-week moving average of claims, which smoothes out volatility in the weekly numbers, fell to 384,000 from 387,000. The most recent figure was the lowest since the week that ended Nov. 30. The insured unemployment rate, which tends to track the U.S. jobless rate, held at 2.6 percent in the week that ended Jan. 18.
Continuing Claims
The Labor Department also said that five states and territories reported an increase in new claims during the week that ended Jan. 18, while 48 states and territories reported a decrease. The number of workers continuing to receive jobless benefits declined to 3.289 million in the week that ended Jan. 18 from 3.345 million the prior week. While some workers may have exhausted their 26 weeks of state benefits and dropped off the rolls, other Americans are starting to find jobs. ``I do believe that it's starting to get better,'' said Kermit Baker II, a software developer from Duluth, Georgia, in an interview earlier this month. After being laid off in June 2002, he began to find contract work in December. Other Americans share his view. The percentage of people viewing jobs as hard to get dropped in January to 28.8 percent, the first decline since August, according to the Conference Board's monthly consumer confidence survey.
Too Lean to Cut More
Companies such as RealNetworks Inc. are finding that they may need a certain number of employees to expand into new businesses. ``As our whole business has shifted from a technology-based business to more of a consumer-based business, we need to hire people in our subscription business to help drive growth,'' Chief Financial Officer Brian Turner said in an interview this week. RealNetworks has faced declining sales of its business software and has compensated by shifting to selling subscriptions to access Internet programming such as baseball games and Internet radio. Other companies are still firing workers. EarthLink Inc., which has had 15 straight quarterly losses, this week said it would close three call centers and a customer-service office, eliminating 1,300 jobs. The third-largest Internet access service is trying to reduce its operating expenses as subscriber growth slows for regular dial-up Web services. Jobs are essential for a recovery because consumer spending accounts for two-thirds of the U.S. economy. Some economists are starting to question whether household spending will be strong enough to keep the economy going until business investment picks up. U.S. shoppers are contending with rising energy costs, falling stock prices and the threat of war in Iraq. //www.quote.bloomberg.com