Over the last few weeks, there have been a few minute indications that the economy has stabilized. The latest encouraging sign comes with today’s Labor Department report that the number of people filing first-time claims for unemployment insurance dropped slightly from last week’s 625,000 to 621,000. To be sure, that remains well above levels consistent with a strong economy. A year ago, initial claims were 370,000. In addition, a number of experts have been predicting that unemployment will rise from April’s 8.9 percent to 9.2 percent when the May figures are released tomorrow.
Still, there was other positive news in the Labor Department report. The number of people receiving jobless benefits shrank by 15,000 from 6.750 million to 6.735 million. That represented the first decline since January. Continuing benefit claims have been setting record highs in recent months. Continuing claims data follows initial claims data by a week. Also, a separate Labor Department report found that productivity – the output per working hour – rose 1.8 percent in the business sector and 1.6 percent in the non-farm business sector. Those numbers were higher than the Labor Department predicted in a May 7 report. Greater productivity has wider benefits, raising living standards as industrious employees earn more without companies having to raise prices.
Some recruiters focused on the finance sector are a little more hopeful about the near future. “I do feel it’s steady as she goes just as it has been the past three to five weeks,” says Paul Herrerias, a managing director in the San Francisco office for executive search firm Stanton Chase. “There’s more conversation about recruiting again. I’m encouraged that the stock market is steadily inching forward and that’s where we think the economy is going as well. Hiring will start to pick up.” But Herrerias added “there’s still a lot of pain out there. It’s still a long way before big financial services firms will be hiring (in large numbers) again.”
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