11 May 2006, 17:34  U.S. jobless claims stay high

First-time claims for state unemployment benefits filed last week stayed just below the highest level seen this year, reflecting layoffs associated with a partial government shutdown in Puerto Rico, the Labor Department reported Thursday. The number of initial claims in the week ended May 6 fell to 324,000, but this was down only 1,000. Also, claims in the previous week were revised to an increase of 9,000 to 325,000, compared with the initial estimate of a rise of 5,000 to 322,000. This was the highest level since the week ended Oct. 15. Last week's small decline was not as large as economists expected. The consensus forecast of Wall Street economists was for claims to fall by 6,000 to 316,000. Excluding Puerto Rico, initial claims would roughly be nearer the low 300,000 level, a Labor Department official said. The four-week average of seasonally adjusted new claims rose by 2,500 to 317,250. This is the highest level since the week ended Dec. 10. The four-week average smoothes out weekly fluctuations in the data caused by one-time events such as the budget crisis that's gripped Puerto Rico. Meanwhile, the number of people collecting unemployment checks fell 49,000 to 2.39 million in the week ended April 29, while the four-week average of continuing claims fell by 7,250 to 2.43 million. The insured unemployment rate -- the percentage of those eligible for benefits who are receiving them -- fell to 1.8% from 1.9% in the previous week. Initial claims represent job destruction, while the level of continuing claims indicates how hard or easy it is for displaced workers to find new jobs.

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