The increase of 71,000 claims on last week’s total of 457,000 brought first time unemployment benefit claims to their highest level since July 1992, when the US struggled with a recession.
The steep increase in this week’s claims reflects a ripple effect from the terrorist attacks in New York City and Washington DC, which affected consumer sentiment, which impacted the travel and tourism industries.
The closely watched four-week moving average, which analysts view as a more reliable indicator of unemployment, since it smoothes out weekly volatility, increased by 29,000, reaching 453,500 from 424,000 in the previous week.
The data release comes ahead of the September US unemployment report, due out tomorrow, which is expected to reveal a labor market that was already weakened prior to the terrorist attacks.
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