Jobless filings increase for first time in a month However, shortages of workers are noted in some areas

August 09, 1996|By BLOOMBERG BUSINESS NEWS

WASHINGTON -- The number of Americans applying for unemployment benefits rose last week for the first time in a month, though the less volatile four-week average showed continued strength in U.S. labor markets.

"I'd be pretty optimistic about finding a job these days," said James Padina, an economist at MMS International in San Francisco. "It's really hard to find workers in some places."

First-time jobless claims increased by 24,000 -- in line with Wall Street's expectations -- to a seasonally adjusted 318,000, Labor Department figures showed yesterday.

Two weeks ago, claims fell a revised 27,000, initially reported as a drop of 29,000.

More important, though, the four-week average for claims -- considered a less volatile gauge of employment conditions -- fell to 325,000 from 338,000 the previous week.

That "fits in the scenario of a labor market that remains very tight," said Elliott Platt, an economist at Donaldson, Lufkin & Jenrette in New York.

The Federal Reserve's latest regional economic survey said Tuesday that many businesses continue to report shortages of qualified applicants. While that's good news for the jobless, if those shortages persist, "We could begin seeing some wage pressures" that would eventually translate into a higher rate of inflation, said Dan Seto, an economist at Nikko Securities in New York.

And the Labor Department's July employment report, released last Friday, broke a pattern of larger-than-expected employment gains in the first half of the year.

The U.S. economy added 193,000 jobs in July -- about 11,000 fewer than expected -- as the unemployment rate edged up a tenth of a point to 5.4 percent.

Federated Department Stores Inc., May Department Stores Co., and Sears, Roebuck & Co. each reported falling sales at stores open at least a year.

Analysts attributed the weakness in retail sales, in part, to people staying home to watch the Olympics on television. However, stores also offered fewer bargains and sales last month.

Investors shrugged off the jobless claims and retail sales reports, as well as statistics pointing to an increase in mortgage applications, and focused instead on the Treasury's sale of $10.001 billion in 30-year bonds. The bonds drew a lower-than-expected average yield of 6.768 percent at the auction.

Pub Date: 8/09/96

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