U.S.:438K JOBS LOSSES,$59BL TRADE DEFICIT
U.S.:438K JOBS LOSSES,$59BL TRADE DEFICIT
2005-10-14 at 10:43:00 am #14196
job Losses Up to 438,000, Trade Deficit to $59 Billion
(Oct. 05) – Rita jumped
to 438,000 last week as the economic shockwaves from the nation’s
costliest natural disaster continued to be felt six weeks after Katrina
careened across the Gulf Coast.
The Labor Department reported that an additional 75,000
hurricane-related claims were filed last week out of a nationwide total
of 389,000 new claims for unemployment benefits.
Government analysts said that Katrina, which hit near New Orleans on
Aug. 29, was still accounting for more layoffs than Rita, which came
ashore near the Texas-Louisiana border on Sept. 24.
In other economic news, the Commerce Department reported Thursday that
the nation’s trade deficit rose 1.8 percent in August to $59.03
billion, an increase that was driven by a record foreign oil bill.
The cost for foreign oil rose by 12.2 percent to an all-time high of
$17.16 billion in August, up from $15.3 billion in July. The average
per barrel price of imported crude oil also set a record at $52.65 in
August with further increases forecast given the surge in oil prices
The rise of 75,000 in hurricane-related unemployment benefit claims was
up slightly from 74,000 such claims two weeks ago, the first week that
claims from Rita showed up. The highest week for claims attributed to
the hurricanes was the week ending Sept. 17, when claims from Katrina
Analysts said it is likely that hurricane-related claims have peaked
but they said it was likely that they will remain a significant portion
of total jobless claims for several more weeks, reflecting the
widespread destruction which wiped out thousands of businesses along
the Gulf Coast.
The government reported last Friday that the nation’s jobless rate was
pushed to 5.1 percent in September from a four-year low of 4.9 percent
in August. Business payrolls fell for the first time in two years, a
decline that was also attributed to the hurricanes.
The 389,000 new claims for jobless benefits that were filed last week
represented a drop of 2,000 from the 391,000 claims filed two weeks
ago. Analysts have been encouraged that the level of jobless claims in
the rest of the country has remained steady, indicating that the
overall economy has been able to weather so far the shocks from the
hurricane and the resulting surge in energy prices as Gulf Coast
production facilities were shut down.
The weekly jobless claims report showed that the biggest increase for
the week ending Oct. 1 occurred in Texas, a rise of 17,931 that was
attributed to the hurricanes. The layoffs occurred in construction,
public administration and manufacturing.
Louisiana had the second largest increase in layoffs, a total of 8,580,
a rise that was also attributed to the hurricanes. The breakdown for
individual states lags behind the national data by one week.
Analysts predicted further bad news on the trade deficit in the months
ahead, reflecting the surge in energy costs that occurred after Katrina
and Rita shut down refineries and oil and natural gas platforms along
the Gulf Coast. Crude oil prices briefly spiked above $70 per barrel
right after Katrina hit.
Underscoring that point, the Labor Department said in a separate report
that the price of imported goods rose by 2.3 percent in September. The
gain, the biggest in 15 years, was driven by a 7.3 percent surge in
petroleum prices. The cost of foreign oil is now at record levels,
pushed up by big increases over the past four months.
The August trade deficit of $59.03 billion was up from a revised imbalance of $57.96 billion in July.
U.S. exports in August rose by 1.7 percent to a record level of $108.18
billion. Imports were also at a record, rising by 1.8 percent to
America’s deficit with China increased to $18.47 billion in August, up
4.6 percent from the July level. The deficit with Japan narrowed
slightly to $6.59 billion in August, compared to $6.63 billion in July.
The U.S. trade deficit with Japan fell to $6.59 billion from $6.63
billion in July while the deficit with the 25-nation European Union
increased to $11.29 billion and the deficit with Canada widened to