Continuing Claims Fall For Jobless Benefits

By Annys Shin
Washington Post Staff Writer
Friday, June 19, 2009

For 21 consecutive weeks, the number of people collecting unemployment benefits from the government has grown. Finally, new data show, the streak has been broken.

Continuing claims for the week ending June 6 fell by 148,000, to 6.7 million, the Labor Department reported yesterday. While the overall level of claims remains extraordinarily high, the decline marked the biggest drop in more than seven years.

Because of the way the Labor Department reports jobless claims, there is no way to know definitively why the rolls shrank. Analysts said the decline suggests that while employers have not stepped up hiring, they are cutting fewer jobs. But there are other data indicating that at least part of the reason for the shift is that more unemployed people are simply exhausting their benefits.

Unemployment benefits typically last 26 weeks. Because of the recession, most states have extended those benefits with help from the federal government. In states with high unemployment rates, such as Rhode Island, where unemployment is above 11 percent, benefits have been extended for as long as 79 weeks, or roughly 20 months.

With the recession officially in its 18th month, though, it has become increasingly difficult for workers to find new opportunities.

There are five unemployed people for every job opening, according to government data, and a record 27 percent of the unemployed have gone more than six months without finding work.

Initial jobless claims rose last week to 608,000. That level is still consistent with very large job losses, Wachovia economist Mark Vitner said.

"Businesses are not hiring and people are entering the workforce and not finding jobs," he said. "People are looking for signs that things are getting better and tending to grab onto anything they can find. It may be too soon."

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