Reorganization Of EBay Leads To 125 Job Cuts
March 21, 2008
The online edition of The Wall Street Journal announced today that EBay is planning to cut 125 jobs as a part of the reorganization enacted by new CEO, John Donahoe.
The aim of the modification is to move both people and resources to parts of the world that are crucial to modernizing the online marketplace mogul. Currently Ebay employs 15,500 employees worldwide, and the cut of 125 jobs is less than 1% of employees.
Chairman of American Express gets huge pay increase
February 26, 2008
The chief executive and chairman of the American Express Co. received a very huge boost in pay for the year 2007. On the 25th of February it was announced that Kenneth l. Chenault is getting a compensation which is approximated at a value of $53.2 million in the year 2007. This amount is almost twice the amount he got in the previous year. The news was let out in a regulatory filing on the 25th of February.
The main reason for him getting this big increase is because of a very high rise in the stock and options grant the American Express gave him. Chenault who is only 56 got an enormous amount of $42.8 million as stock awards for his performance in the year 2007. Apart from this he also got a special incentive stock option grant. This is way more than what he had got in the previous year in the form of stock awards. He had got only $16.9 million in 2006 as stock awards.
American Express also increased the base salary of Chenault in the year 2007 by an incredible figure of 13 percent to bring it to $1.24 million. Last year his base salary was only $1.10 million. Apart from the huge increase in base salary the company also gave him $6.5 million as bonus. He had received the same amount in the previous year as well.
He also got compensation in the range of $1.04 million for the year 2007. This amount however covers perquisites like a home security system worth $126,992, $323,884 for the personal use of the company plane as well as $102,601 for the personal use of company owned cars. For the time being the chairman was able to pull in $1.55 million above-market returns in the form of deferred compensation in 2007.
The total amount Chenault had received in the year 2006 was almost $27.3 million as per the statistics that was let out by the Associated Press. According to the calculations Associated Press has made the total pay which includes salary, incentives, bonuses, perquisites, and the approximate value of stock options and awards granted in a year. The calculations which are made do not include the changes in current value of pension benefits.
Chenault however might not be able to realize the 2007 grant–date value of his stock award unless American Express is successful in bouncing back from the tough consumer credit surrounding. In the year 2007 the American Express shares had fallen by more than 14 percent. The fall in 2008 till date has been 13 percent. The company however was able to gain 15 percent on the 25th of February to close at a price of $45.21.
The company however is doing rather well. They announced that the net income in the year 2007 rose from $3.71 billion to $4.01 billion. The revenue in the year 2007 also went up to $24.14 billion from $22.16 billion in the previous year.
Average monthly jobless claim to be high
February 22, 2008
Even though the jobless claims took a fall in the relatively short week, the four week monthly average edged to a higher level than in the previous months. The drop in jobless claims which came as a surprise to many economists is believed to be only a short term phenomenon and that things would return to normal in some time. The four week average in the month of February however was the highest average in the past 28 months. This indicates how high the number of jobless people is in the country at the moment.
The labor department on the 21st of February announced that the number of jobless claims had gone down by 9000 in the previous week to become a total of 349,000. Almost all the economists in the country unanimously said that this drop in jobless claims was way bigger than what had been expected. However they said that, in the State of California, the offices were closed for one day because of a state holiday. This would mean the jobless people would have one day less than the usual to file their claims for unemployment.
The four week average, which gives a better picture of the current scenario however, is very bad indeed. This average gives a clear indication of the current labor market trend. It is alarming to note that this has risen to 360,500. This was the highest level the unemployment claims have come to since the month of October in 2005 when the jobless claims had risen very high as a result of the havoc created by the Hurricane Katrina.
Analysts of the labor market said that the big rise in the four week average was indicating a labor sector which is being heavily strained by an ever slowing economy. The Federal Reserve on the 20th had come out with forecast of the growth of the economy that would happen in the year. In this report, however, they were of the view that the country still has the resources to avoid its economy going into a recession.
On the other hand many other private economists in the country are of the opinion that the country is already in a recession. They say that the economy has already entered a downturn which started from this quarter. They believe that this downturn is going to last throughout the spring. These economists are also predicting that the growth rate of the country is going to turn negative in the first two quarters of this year. The growth rate of USA in the last three months last year was only 0.6 percent. So what the private economists predict also holds true. Theoretically an economy is said to be in a recession when it goes through 2 consecutive quarters of negative growth.
Even though many attempts like the stimulus plan have been implemented by the State to avoid a recession and to keep the economy in a strong position most of them would start functioning only after or in the middle of the third quarter. So the first two quarters are definitely going to be a period of very slow growth.
The uneasiness increases further
February 18, 2008
Many American citizens are of the opinion that the living conditions in the country is getting more uneasy by the day. This opinion is coming even while most of the economists in the country are of the opinion that the economy of the country is healthy enough to get out of the minor troubles it is in at the moment.
In the last few years when jobs were available in plenty and it was relatively simple and cheap to borrow many people did not feel that everything was right. High prices of homes and the availability of plenty of credit cards allowed the people of the country to go out and splurge on commodities. But even during those golden days many people felt things were not right. Now that the golden period has come to an end finally the undertow that was present ever since then has gotten stronger. Now if the easy credit is taken away most of the consumers in the country find that the pay cheques they get have not kept the same pace with their needs and their affinity to spend cash.
The hard truth that they have to pay $3 for gas and $4 for milk has finally hit the people of the country who earlier were not too concerned about the fact. The health care expenses most people of the country incur in a year are almost four times the amount they get as pay. Even the certainty of getting the retirement security that they have been promised is solely dependant on the state of the stock market.
The confidence of the American consumers are decreasing by the day and the main reasons that can be attributed to this are the collapse of the housing market in the country, unavailability of credit and the heavy debts most people in the country have. All this when combined with the anxiety that was there all along broadcasts the situation out of control. The fact that the economy is currently in a recession or on the verge of going into one is definitely playing on the people’s minds. The increasing levels of anxiety and fear that is present in the people’s mind right now is not going to go away any time soon even after the economy shows some signs of improvement.
Much of the anxiety that is present right now is because of the uncomfortable feelings that one gets from the economic roller coaster ride. The consumers become less confident about clinging on to their jobs or about getting new ones. The growing fear of meeting the household expenses and other future prospects make the life of the people even more uneasy.
The truth that the people of the nation have been facing for quite some time is visible from the fact analysis which was taken months before the economic crisis broke out. The report showed that nearly 2 out of 3 Americans felt that the economy was not as secure as it used to be nearly a decade ago. Another half said that the economy was going to get even worse in the future.
Small businesses benefits from SEC’s change in rule
February 15, 2008
The change that has been made to rule 144 by the Securities and Exchange Commission is going to help the small companies in negotiating their private investment deals in a better way. It is predicted that the change will facilitate for a huge amount of small-cap stock being liquidized in the week. The change that has been made is that the holding-time for investors has been shortened as well as restricting the securities from one year to six months. The change will come into effect from the 15th of February. The change however might provide for a massive small-cap sell-off as well, if the investors decide to get rid of their stocks.
The change which has been brought about in rule 144 of the SEC, is to make sure that the undersized publicly owned companies in the competition are able to raise enough capital by making the lockdown period shorter during which time the investors from outside have no option but to hold on to their individual shares. Usually these small companies raise the required capital through the policy often known as “private investment in public equity” (PIPE) deals. Such deals usually involve the selling of huge chunks of stock to the outside investors at a discounted rate. These outside investors are then required to hold on to these shares during the time known as the holding-period. There are various holding-period rules they have to abide by before they are able to sell off their shares. Now that the holding period has been shortened, as per the new change in the rule of the SEC, the companies will be able to negotiate more private investment deals. The rule 144 being retroactive will make all those restricted securities which were issued between the periods of February 15 to August 15th of year 2007 be eligible for trade immediately.
The market experts are expecting the changes in rule to encourage the investors to follow private investment agreements more vehemently. They believe that the revision in rules could not have come at a better time because of the ongoing credit crunch situation due to which many small businesses are suffering. They believe that if the securities are liquidized in six months instead of one year it would attract more people to invest in such stocks. The change would also help these small companies to negotiate better terms as well during the sale of stocks. The outside investors who would have earlier required a discount of ten percent for a PIPE deal may now agree on a five percent discount because of the reduced holding period. This is because there will be a change in perspective of the investors when they find that the holding period is only half of what it used to be earlier. The investors would now even consider investing larger amounts into these small businesses.
However these revisions might also ignite a massive sell-off by the current private stock holders. This is because once the change comes into effect billions of dollars become saleable and the investors might try to make full use of this. However this volatility is expected to be a short lived one and that it will level off in some time.
Lenders stop foreclosure proceedings temporarily
February 14, 2008
On Tuesday the nation’s six main mortgage lenders joined together to agree on a temporary stop on the ongoing foreclosure proceedings. The effort has been taken by the banks in an effort to calm the current crisis that has risen in the state because of these forced sales of homes. The temporarily freeze on foreclosures are to help those homeowners who have really fallen behind in their payback installments. The program which was launched on Tuesday has provisions which would entail the delinquent home owners, against whom legal steps of foreclosure have been taken, to get a reprimand of another 30 days. This period has been given so that the lenders as well as the people who borrowed the money will have some time to work out some repayment options.
The program has been named as Project Lifeline and this is not just for those borrowers who have taken Adjustable rate mortgages. The number of defaults on loans has been highest for these kinds of loans, and the general numbers of delinquencies on loans have also increased dramatically in the last few years. Project Lifeline has been created so that the families who are facing the risk of foreclosure will have some more time to figure a way out of the mess. Steps for modifications in the loan policies are another step the lenders might consider very shortly. However the lenders made it clear that Project Lifeline is not just for those people who have taken a sub prime loan but also for those people who have taken any kind of home mortgage loan.
Citigroup, Countrywide, Bank of America, JPMorgan Chase, Washington Mutual and the Wells Fargo are the six banks that have so far joined together to make the program a success and to help the suffering homeowners. The project has received the backing of the Jackson treasury and the foreclosure prevention coalition backed by the government, Hope Now.
The officials who are engaged in the implementation of the project said that this is not going to save each and every home owner as there will be still many out there who will not any action even now, and many others who will just walk away from the program. But they remained optimistic that at least those people who are facing the risk of an immediate foreclosure might be able to benefit from this plan.
The homeowners who are behind by 3 months in the repayment of their mortgages will get a letter from the lender asking the homeowner to call back. Once the homeowners do that they will be asked if they want to continue living in their home and if they want to they will be given financial counseling. The modifications in the loan are not granted at this time. Once the borrowers submit their current information regarding their wages and debts the lender makes the final decision on whether or not to freeze the foreclosure temporarily. The modifications are made only after the lender carefully studies the details that have been submitted by the borrower and confirms that the loan can be repaid by the person.
Microsoft determined to get Yahoo
February 13, 2008
After the internet company Yahoo rejected the $45 billion takeover bid the industry giant Microsoft is all determined to get it under its belt. Now there is all possibility of witnessing a drawn out battle by Microsoft to unseat Yahoo’s board.
On the rejection of the takeover bid, Yahoo officials said that the entire management of the company had unanimously decided after careful evaluation of the bid that it undervalued the brand substantially. They said that the online demand and growth prospects of the company along with its recent investments in the internet advertising sector have not been taken into account at all. Now that the company has chosen to defy Microsoft’s offer it has set the scene for a battle of the giants in the Silicon Valley. Now the entire world’s eyes are set on Microsoft to see what their move is going to be. Will they increase their offer and bid again or will they choose to play it tough by trying to install their choice of directors in the Yahoo board. From reliable sources it was found that the initial letter that was sent by Microsoft to Yahoo said that they had the option of doing this the hard way or the easy way. From recent developments we are led to believe that Yahoo is ready to play hardball with the computer tycoon and ready to take the challenge on.
However the Yahoo officials are almost certain that the chances of them remaining independent are very slight and this is obvious from some of their recent remarks. Yahoo through various such remarks and statements have left the options open for further negotiations with Microsoft.
The offer of $31 per share made by Microsoft was at a premium of 62% to Yahoo’s stock price, but it is rumored that Yahoo was adamant on getting at least $40 per share. All the on going processes have led to an increase in Yahoo’s share price.
The sudden move by Microsoft to take over Yahoo is believed by many to become a credible opponent for the Google Company. They want to compete with Google, who with their advanced search technology was able to build a dominant position in the international market for online advertising. Microsoft is eying this advertising sector as the money that is being spent in this field is predicted to increase by two thirds to almost $75 billion by the end of 2 years.
It is rumored that Microsoft, chaired by Bill Gates, would start selecting candidates to stand for Yahoo’s board. Since the last date for nomination of names into the board is 13th of March the final result of whether or not a takeover should take place would depend solely on the votes by the Yahoo investors. But since this is a disruptive process it might end up in the resignation of some of the key staff in Yahoo. So Microsoft will have to think over any of its decisions with utmost precaution.
Countrywide To Slash Jobs
September 10, 2007
Countrywide Financial, the US’s biggest mortgage lender, is to make substantial job cuts, amounting to up to one fifth of its current workforce.
Countrywide had been one of the worst hit lenders by the ongoing sub-prime disaster, which continues to haunt banks throughout the US and indeed across the world.
The job cuts, to extend to around 12,000, are set to reflect significant losses from rising defaults and the current negative US housing market which has seen the company share price fall by half in recent months.
Official projections from Countrywide forecast a decrease in new mortgages by up to 25% through 2008 on 2007, after what has already been a bad year for mortgages and mortgage lenders.
As interest rates have risen, the widespread practice of over-lending to the sub-prime sector has left many banks and lenders across the world struggling for liquidity. With cash tied up in mortgages that homeowners can’t afford to repay, banks have learned the tough lessons of over exposure to risk.
With repossessions and foreclosures dramatically up at present, buyers are even keener to stay away from the over-supplied US housing market in favour of renting accommodation, amidst fears that the economy as a whole is continuing to perform below par.
House price inflation has almost completely ground to a halt over the last few years, reflecting the extent of imbalance within the housing market and encapsulating the degree of difficulty faced by those exposed to the sub-prime
With the number of new home buyer enquiries falling constantly, and top banks forced to borrow money or sell assets to fund daily cash flow, the situation has led to a sharp fall in investor confidence with an undoubted knock-on effect on the wider economy.
Countrywide Financial have already cut 1,400 jobs as a result of recent events, signifying a marked reduction in staff and labour costs.
US Workforce Ranks Top For Productivity
September 3, 2007
US employees came out on top of a survey of workforce productivity per person by nation, according to a report released today by the International Labour Organisation.
The survey covered the wealth created by each employee on average as a measure of production output, before compiling a leader board of nations by value. The annual report has seen the US stalk the top of the table for several years, remaining fixed a number one through 2006 with longer working hours than most other developed nations.
The US topped the table for 2006, with each worker coming in at having produced $63,885 of wealth. Analysts have suggested that the impact of longer working hours has led to the US workforce taking the coveted top spot.
The Republic of Ireland came in second place in the rankings, with average output of $55,986 per person over the course of 2006, whilst East Asian nations made the greatest progress from the last survey.
The figure is calculated by dividing total national output by total employment numbers, producing an average value per employee. In a different measure of productivity, which sees value added per hour, the US still maintained a high ranking, coming second only to Norway.
With the US economy facing significant threats from the rocky sub-prime sector, and analysts fearing the economy is performing below other major world economies, the news today comes as consolation to investors, and a sign that the market could be on the road to recovery.
The news was well received on the stock exchanges, with the Dow Jones growing considerably by the end of the day. Analysts are predicting that with interest rate cuts at the Federal Reserve likely, the US economy could see a further turnaround over the coming months, despite the ongoing sub-prime crisis that has thus far hampered growth.
Federal Reserve Bails Out Lenders Again
August 23, 2007
A consortium of mortgage lenders from the US and Europe have received a loan of around $2 billion from the Federal Reserve, it was announced today.
The loan was granted to a number of banks and lending institutions from the US and from within Europe, as a means of reducing liquidity problems in the short term.
Amongst some of the lenders were high profile banks such as Bank of America, Deutsche Bank and Citigroup, all of which have been hit badly after the problems from the sub-prime sector.
The US sub-prime mortgage lending sector has been a source of woe for mortgage lenders and market investors across the world over the last few months.
After credit was too readily made available, rising interest rates pushed repayments out of reach for many in the sub-prime sector, leading to rising defaults and extreme cash flow problems.
As a result investors worldwide have feared the potential for a credit crisis, with banks too short of funds to lend money to consumer and business borrowers alike. Were a so-called “credit crunch” to materialise, analysts have predicted we could be in for a global recession, with many businesses unable to finance expansion.
The move to borrow from the Federal Reserve was considered highly unorthodox, particularly given the stigma attached to central bank borrowing within the finance market.
Of the banks involved, only German giant Deutsche Bank refused to disclose the size of its loan, with many of the other notable lenders accepting $500 million each.
While this may provide short term finance for lending, analysts are quick to point out that this is still far short of a long-term solution, and with the US sub-prime still causing problems for lenders, there is no telling when this global volatility will come to rest.
US Price Inflation Marginally Up
August 15, 2007
US inflation has fallen of the course of July, according to official figures released today.
The Consumer Price Index, which reflects the value of a typical consumer spend, grew by just 0.1% over the month, according to the figures released by the Labor Department today.
Analysts have attributed the falling cost of fuel through the decreased price of crude oil could be a major factor in suppressing inflation, a claim that is given further weight by the core rate of inflation on the month.
The core rate of inflation, calculated without including food and fuel prices, was shown to have risen by 0.2%, showing the impact of the falling oil price on US consumer inflation.
Additionally, today’s figures reflected a fall of 1.7% in petrol at the pump, showing the knock on effect of import crude oil prices on daily life, and the dramatic impact of lowering prices on US consumer inflation.
The news was well received by the Federal Reserve today, who have chosen to maintain interest rates at 5.25% to keep inflation under control for an unusually long period of time.
Analysts have predicted that today’s figures should be sufficient to maintain interest rates at their current level for next month, after the Federal Reserve meet to determine their next step.
The Federal Reserve, the central authority responsible for setting interest rates in the US, are expected to maintain interest rates for the fourteenth consecutive month after today’s indication that inflation is under control.
However, the Federal Reserve have been criticised for their lack of intervention in markets over the last year, where interest rates have remained solid despite changing economic circumstances.
The Federal Reserve will meet at the beginning of next month to discuss interest rate policy for the coming thirty days.
Unemployment Benefits Increase Over July
August 10, 2007
The number of people claiming welfare unemployment benefits in the US economy grew over the course of July, according to figures released today.
The US Labor Department announced today that claims for unemployment insurance had risen to 316,000 last week, making it the highest level since the end of June.
The news comes as economic conditions in the US seem to be worsening, with both Wall Street and big business exercising caution and prudence in their affairs.
The ongoing sub-prime lending saga has created global uncertainty, prompting fears of a potential credit crunch around the world.
A credit crunch, where banks are less likely to lend money through liquidity problems to other banks, businesses and consumers, is projected unless drastic recovery measures are initiated in the US housing market.
The potential for a credit crunch is thought to be the reason behind abysmal consumer spending in the US, and the ongoing lack of new home buying nationwide.
With the potential for recession in the global economy on the cards, the European Central Bank and the Federal Reserve plunged money into banking sectors, which has seen major share sell-offs and diving market confidence.
It is thought that tightening credit could be behind the increasing job cuts in the US, whilst the lack of consumer spending is thought to be a derivative of both credit crunch fears and increasing lay-offs.
The struggling auto industry, aside from the housing market, is thought to be one of the main contributors to increasing job cuts, whilst the number of state unemployment benefits paid out in the last week in July rose to over 2.55 million in the worst week of the month.
Chairman of the Federal Reserve Ben Bernanke has suggested that the resilience of the labour market and economy as a whole will ultimately see it through in spite of poor economic indicators.
US Worker Productivity Performs Below Analyst Expectations
August 7, 2007
US worker productivity has grown at the fastest rate in over a year, despite still falling short of many analyst predictions, according to figures announced today.
The figures released by the US government today indicated that productivity amongst the American labor force had grown to 1.8% on the year over the course of last month.
However, this is still below the 2.0% mark most analysts had been predicting in the run up to the announcement, putting a damper on the positive result for the US economy.
Labour costs remained consistent over the period in which productivity increased, which has been taken as a positive step for inflation in the US economy.
The growth in productivity comes as the most substantial growth since the first quarter of last year, where productivity saw an increase of 2.5% according to Labor Department Statistics.
The news has been taken well on major stocks markets across the world as a sign of some potential recovery within the US economy, echoing a rally on the Dow Jones earlier on in the day.
After months of prolonged struggling within the US economy, the increase in productivity is considered by some to be a step in the right direction for the US, which has helped rally investor confidence over the course of today.
However, a cross section of analysts had anticipated 2% growth on the year, after 0.7% over the first quarter of 2007. The growth is seen as falling short of the level it should have reached according to other economic indicators, presenting further underlying concern behind today’s positive news.
The Federal Reserve are expected to keep interest rates at a consistent 5.25% later on today, which is also expected to result in a bounce on the Dow Jones.
US Employers offering fewer jobs than expected
August 4, 2007
In what appears to be a setback for the economic growth the US has seen in recent months, unemployment rate has risen to the highest level since the beginning of the year.
There is now a 4.6% unemployment rate nationwide for the month of July, which sets it equal to the unemployment rate in January. These are disappointing figures that will not ease the worries that many are having over the economy.
These fears have been prompted primarily by the country’s mortgage sector that has been shaking markets across the world for quite sometime
Some have stated concerns that sub-prime lending problems and credit jitters may continue to push the unemployment rate further down as it has not quite yet had an impact according to experts.
With market confidence at an all time low, many have suggested that lack of fresh investment as one cause of the situation, with companies too nervous to incur increasing expenses at this time.
The employment pace in July had been the slowest since the month of February when only 90,000 jobs had been added.
In recent months job growth had been heavily supported by the service sector, which had 104,000 job added. The industry as a whole, however, has had 12,000 positions removed.
The Labor Department has stated that there are now 6,000 fewer jobs created for June. Only one month earlier, 188,000 jobs had been created – this was 2,000 fewer than what had been estimated.
The US economy overall has grown by 3.4% between March and May but was put to a stop in June. Although this was faster than what had been expected, more recent economic indicators show that spending of consumers and home building is on a decline, which would suggest ongoing economic distress beneath the surface.
Microsoft chairman calls US immigration curbs harmful to competitiveness
March 8, 2007
Microsoft (NAS: MSFT; HKSE: 4338) chairman Bill Gates has said that the competitiveness of the United States in the global market could be compromised by setting restrictions on the number of skilled workers allowed to enter the US each year. In testimony before the US Senate committee on health, education, labor and pensions, Mr. Gates expressed the concern that US immigration policies that have been tightened in recent years are “driving away” the “best and the brightest” from seeking education and work in the US.
Mr. Gates further held that other nations are taking advantage of the new, more restrictive policies to lure highly skilled workers to their countries. These are individuals who, Mr. Gates contends, would otherwise wish to live, study, and work in the United States. He said that he sees the detrimental effects of current US policies, put in place at least partly out of concern about terrorism, every day at Microsoft.
Currently, the US issues only 65,000 visas for skilled workers to enter the US each year, while it only issuese a total of 140,000 “green cards” granting permanent resident status each year. Mr. Gates said that while there are concerns that US workers could lose jobs to immigrants if the rules are loosened, he also said that highly skilled foreign workers could also help create new jobs in the US.
The warning came amid a more general concern from Mr. Gates that if the US does not act soon to improve education and invest in basic scientific research, the US would lose its ability to compete with the rest of the world. He said that the data he has seen suggests that the nation is currently not making the improvements that are necessary, especially in high schools.
Jobs claims increase from Katrina
September 29, 2005
While total first-time jobless claims in the United States were down by 79,000 last week, for a total of 356,000 new claims compared to the 435,000 claims filed the previous week, 60,000 more people left without jobs by Hurricane Katrina filed claims last week. Those brought to 279,000 the number of jobless claims attributed to Katrina.
The figure of Katrina-related claims from two weeks ago was revised upward from 103,000 to 108,000, and in the first two weeks after the storm 20,000 and 91,000 Katrina-related claims were filed. Analysts believe that there are more Katrina-related claims to come as mobile claims offices travel to shelters and take the claims of those who have not been able to reach unemployment offices to file.
Some private analysts expect the total number of people put out of work by Katrina to reach 500,000, while the Congressional Budget Office says the number of jobless as a result of the storm could reach around 400,000. There is also expected to be a rise in claims from those put out of work by Hurricane Rita.
Katrina impacts Labor Department figures
September 15, 2005
According figures reported by the US Labor Department on Thursday, a total of 71,000 more people filed first-time unemployment claims in the week ending September 9 than in the week before.
This was the largest rise in new claims in nearly 10 years, topping the number of claims filed in the weeks following the September 11, 2001 terrorist attacks, which generated 59,000 and 64,000 new jobless claims in consecutive weeks.
Most of last week’s increase, 68,000 new claims, was attributed to the effect of Hurricane Katrina, and officials say that the number will likely be adjusted upward once state unemployment offices catch up with a backlog of claims.
The estimate of new claims generated by Hurricane Katrina for the week ending September 3 has already been increased from an initial estimate of 10,000 to between 15,000 and 16,000. The surge in new claims brought the total number of first time claims in the week to 398,000, which was the highest weekly total in two years.
Some analysts believe that when all is said and done, Hurricane Katrina will have cost somewhere around 400,000 jobs.
US Department of Labor reports more jobs filled
July 12, 2005
According to the US Department of Labor on Tuesday, there were fewer job openings in the United States in May but more jobs were filled. Openings were up in the leisure/hospitality sector as summer drew near, but they were down in construction, manufacturing, government, and education/health services, among other sectors.
Job openings fell by 3.1 percent in May to 3.465 million, from the 2.576 jobs that opened in April. Meanwhile, hirings were up 3.7 percent in May, to 4.798 million. They had been at 4.538 in April. Trade/transportation/utilities hirings fell in May, as did hirings in the education/health sector, but they were up in construction, manufacturing, professional/business services, leisure/hospitality, and government.
Some of the drop in job openings in May came on a drop of 3 percent in separations - voluntary resignations and retirements as well as firings. There were 4.425 million separations in May, after 4.562 million in April. Only the leisure/hospitality sector had an increase in separations in May.
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