New jobless claims rise sharply
( 2002-01-04 14:59 ) (7 )

New claims for unemployment insurance shot up for the second week in a row, suggesting many U.S. workers are still suffering from an economy that is trying to claw its way out of a recession.

For the work week ending Dec. 29, new claims for jobless benefits jumped by a seasonally adjusted 36,000 to 447,000, the highest level since the beginning of December, the Labor Department reported Thursday.

The week before, new jobless claims rose by 26,000, according to revised figures. That was a much bigger increase than the 7,000 gain previously reported.

In another report, the Commerce Department said construction activity rose by a solid 0.8 percent in both October and November.

A 4.6 percent increase for big government projects led the way in November, with spending rising for highways, schools, hospitals and public housing. Commercial projects, including hotels and industrial complexes, by private builders also posted gains, 0.5 percent.

But residential construction by private builders dipped by 2.2 percent, despite low interest rates and brisk housing sales.

On Wall Street, stocks moved higher. The Dow Jones industrial average gained 75 points and the Nasdaq was up 50 points in morning trading.

In the jobless claims report, a government analyst offered no specific reason for the big increases in new claims but noted that they tend to be volatile during the holiday season.

The more stable four-week moving average of claims, which smoothes out week-to-week fluctuations, declined last week to 409,750, the lowest level since Sept. 1. It marked the fourth straight week that the moving average fell.

To cope with the ailing economy, which fell into recession in March, companies have cut production, trimmed hours and let workers go.