It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
The number of Americans filing new claims for jobless benefits fell to a 3-1/2-year low last week and factory activity in parts of the Northeast gained speed in December, suggesting a further strengthening of the economic recovery.
While other data on Thursday showed industrial output shrank for the first time in seven months in November, much of the decline came from auto production, which analysts said was held back by temporary supply disruptions.
"It looks like we have just hit a clear patch on the road to recovery, where things are going to speed up a little bit," said Mark Vitner, a senior economist at Wells Fargo Securities in Charlotte, North Carolina.
The fairly upbeat data helped investors on Wall Street to put their aside their worries about the European debt crisis and buy stocks. Prices for U.S. Treasury debt fell, while the dollar weakened broadly.
Although growth is quickening from the third quarter's 2 percent annual rate, analysts caution that troubles in debt-stricken Europe pose a major risk to the U.S. economy. The fourth quarter growth pace is expected to top 3 percent.
Much of the rest of the global economy is already weakening, with the euro zone expected to slip into recession.
The U.S. economy also faces a risk that lawmakers will fail to extend a payroll tax cut and emergency jobless benefits that expired at year end, which would dent the expansion in 2012.
For now, however, it continues to show resilience.
Initial claims for state unemployment benefits dropped 19,000 to 366,000, the lowest since May 2008, the Labor Department said. That follows on the heels of a report earlier this month that showed the jobless rate hit a 2-1/2-year low of 8.6 percent in November.
US mayors sounded an alarm Thursday over deepening economic woes after a survey of 29 cities from Los Angeles to Washington showed worrying rises in homelessness and poverty-related food aid.
"Here is the richest country in the world (and) we have people who cannot find a place to live," said Kansas City Mayor Sly James, who co-chairs a task force on hunger and homelessness for the US Conference of Mayors.
"We are failing" to address critical issues of homelessness and the use of food stamps, which is "increasing, not decreasing," he told reporters on a conference call to discuss the survey.
The government has reported that 46.2 million people nationwide were living in poverty in 2010 and that the rate climbed to 15.1 percent, up from 14.3 percent a year earlier.
Of the 29 cities surveyed -- all of which have more than 30,000 residents -- 25 reported increased requests for emergency food assistance in the past year.
In Kansas City, Missouri, the rate of food aid spiked by 40 percent, the highest increase in the survey, followed by Boston and Salt Lake City with a 35 percent increase and Philadelphia with 32 percent. Food aid requests in San Francisco dropped by 11 percent.
Unemployment was the primary cause of hunger, according to the cities, whose total emergency food budget as a group last year was $272 million.
Gallup's data suggest little improvement in the jobs situation. December unemployment is up slightly on an unadjusted basis. In fact, the government is likely to report essentially no change in the unemployment rate when it issues its report on December unemployment in the first week of 2012. Of course, this assumes that the labor force doesn't continue to shrink at so rapid a pace that it drives down the unemployment rate, as it did last month. Gallup's most recent weekly job creation numbers also suggest little improvement in the jobs situation. As a result, it may be wise to exercise caution in interpreting the drop in the government's most recent jobless claims numbers.
on the far less important broad unemployment rate, or U-3
Unemployment, one of the two components of underemployment, is at 8.7% in mid-December -- up from 8.5% at the end of last month, but down from 9.3% a year ago. Gallup's unemployment measure suggests the government is likely to report essentially no change for December 2011 in its seasonally adjusted unemployment rate, though this is even more difficult than usual to predict at this time of year.
on broad Underemployment or U-6
Underemployment, a measure that combines the percentage of workers who are unemployed with the percentage working part time but wanting full-time work, is 18.4% in mid-December, as measured by Gallup without seasonal adjustment. This is up slightly from 18.1% at the end of November and similar to the 18.5% of a year ago.