Continuing jobless claims rise more than expected

The number of laid-off workers who are continuing to draw unemployment checks jumped more than expected to 4.6 million at the end of December and is likely to keep climbing this year -- fresh evidence that people are finding it increasingly difficult to get a new job amid a deepening recession.

The Labor Department’s report Thursday also said first-time applications for jobless benefits dropped to 467,000 last week. But economists largely described that decline as a distortion, reflecting the government’s difficulty in making seasonal adjustments over the holiday period.

Even with the dip, the figure still signaled trouble in the labor market. A year ago, initial claims stood at 330,000.

Persistent economic woes -- housing, credit and financial crises -- along with a flurry of layoff announcements in the opening days of 2009 all point to another terrible year for job seekers, economists said.

Job hunter Barbara Slavin of Los Angeles knows that frustration.

“Many of the jobs I applied for I was qualified for and didn’t get them,” lamented Slavin, 67, who was laid off last month as an executive assistant for a local chapter of the Girl Scouts. “I got a lot of energy. I like to work, and I don’t know anybody who can live on Social Security alone.”

The government’s report showed that the number of people continuing to collect unemployment benefits rose by a sharp 101,000 to 4.6 million for the week ending Dec. 27, the most recent period for which that information is available. It was worse than the 4.5 million claims economists had expected.

That increase left continued claims at the highest since November 1982, when the country was emerging from a deep recession, though the labor force has grown by about half since then. A year ago, this figure stood at nearly 2.7 million. The increase underscored the painful deterioration that has occurred in the job market.

“Workers getting laid off are not going to get hired any time soon,” said John Silvia, chief economist at Wachovia.

Some economists believe the number of people drawing unemployment benefits could rise as high as 5.5 million this year, even if a new government stimulus package is enacted.

With employers throttling back hiring, the unemployment rate is expected to jump from 6.7% in November to 7% in December, which would be the highest in 15 1/2 years. The government will release that report today.