Claims for unemployment benefits rose by a surprise 2,000 to 414,000 last week, sending stocks downward. Economists had predicted a drop in claims to 405,000.
However, the news indicates a continuing sideways tilt in the economy rather than a new dip. “It’s suggesting sluggishness rather than a dramatic new weakening,” Jim O’Sullivan, chief economist at MF Global Inc. in New York, told Bloomberg. “Recessions are associated with claims shooting up and so far that hasn’t happened.”
However, those out of work are unlikely to be comforted much by the notion that “it’s bad, but it could be worse (for other people).”