Reports indicate continued weak recovery
Published: November 20, 2009, 12:30 am
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WASHINGTON — A gauge of future economic activity and a report on unemployment benefits signaled Thursday that the recovery likely will remain weak in the coming months.
The Conference Board’s index of leading economic indicators rose less in October than analysts had expected. The index forecasts activity by measuring consumer expectations, building permits and other data.
And the number of newly laid-off workers seeking unemployment benefits, unchanged last week, remains above the level that would indicate the economy is adding jobs.
Together, the two reports suggested that the lack of job creation is dampening consumer expectations and prospects for an economic rebound. Uneasy consumers likely will curtail their spending, which powers about 70 percent of the U. S. economy.
New jobless claims have fallen about 22 percent since spring. But companies’ reluctance to hire is weighing down the housing market — and the economy’s fledgling recovery.
A separate report Thursday found that a rising proportion of fixed-rate home loans made to people with good credit are sinking into foreclosure.
And the proportion of homeowners with a mortgage who were either behind on their payments or in foreclosure hit a record high for the ninth straight quarter, the Mortgage Bankers Association reported.
The Labor Department’s report on jobless benefits said first-time claims totaled a seasonally adjusted 505,000 last week. That was the same as the previous week’s revised figure and matched analysts’ expectations. A year ago, there were 533,000 initial claims.
Employers cut a net total of 190,000 jobs in October, down from 219,000 the previous month.
The Conference Board said its index of leading economic indicators rose 0.3 percent last month, indicating a slow, bumpy recovery next year. A gauge of consumer expectations, which are dropping as unemployment rises, weighed down the index.
More than 1 million people will run out of unemployment benefits in January unless Congress quickly extends federal emergency aid, a nonprofit group said Wednesday. The November extension didn’t address an underlying problem: The emergency unemployment compensation program, including all additional weeks, expires at the end of this year.
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