By Msnbc.com staff and wire
More Americans applied for unemployment benefits in the latest week as the end of the holiday shopping season meant layoffs for some workers.?But 2011 was a record year for retail sales, which rose 7.7 percent, even though the year ended on a weak note.
The Labor Department reported Thursday that seasonally-adjusted initial claims for first-time jobless benefits rose 24,000 to 399,000. It was the?highest?in six weeks and suggested the labor market remained spotty despite signs of recent growth. The four-week moving average, considered a better indicator of labor market trends because it smooths wrinkles in the data, rose 7,750?to 381,750 from a revised 374,000 the prior week.
Applications typically soar in the first two weeks of the year. That's because many companies lay off temporary workers who were brought on to help during the holidays. The department tries to adjust for those patterns. But the task is difficult because the data can be volatile.
On a positive note, claims remained below 400,000 which many economists see as a crucial signpost for the direction of the job market.
"What this does say is even with this large clawback we're still under 400,000 so it's clear that we've seen a new underlying decline in jobless claims," FTN Financial economist Lindsey Piegza told Reuters.
The Commerce Department reported Thursday that retail sales rose?0.1 percent in December, the weakest pace in seven months, as consumers pulled back late in the holiday shopping season, cutting purchases at department stores and spending less on electronic gadgets. Excluding autos, sales fell 0.2 percent, the first decline since?May 2010. Novemerb's number was revised upward to a 0.4 percent increase.
"The jobless claims are certainly not going in the right direction. You have people that have been encouraged that the economy is headed in the right direction so this is not what you want to see," Joe Saluzzi, co-head of equity trading at Themis Trading said. "Retail numbers aren't so great either."
The gain in December was enough, however, to push?sales to a record level for 2011.?It was the largest annual increase in more than a decade.
Another report showed business inventories rose 0.3 percent in November, reinforcing the view that fourth-quarter economic growth could get a boost as companies restock their shelves.
Some Federal Reserve officials earlier this week signaled more help for the U.S. economy may be necessary despite recent data that suggested the recovery was picking up steam going into 2012.
Many economists see the economy growing by at least a 3 percent annual rate during the last quarter of 2011 after growing 1.8 percent during the July-September period. Growth, however, is expected to slow during the first three months of this year.
A report from real estate data firm RealtyTrac showed foreclosure activity slowed last year following claims in 2010 that lenders had relied on "robo-signing" where documents were signed without a review of the case files.
A wave of foreclosures has kept downward pressure on home prices, and economists say the market might need to clear before it can mount a convincing recovery and provide a significant boost to the overall economy.
The central bank has tried to boost the sector by lowering interest rates and buying mortgage securities, which helped bring the average rate on 30-year fixed rate mortgages down to a record low this week.
The U.S. central bank is not expected to take any action at its next meeting on January 24-25.
Within the retail report, the upward revision for November sales suggests consumers frontloaded their holiday shopping as retailers discounted heavily and extended store hours in the days following Thanksgiving.
By the end of the season, however, consumers cut back, with spending at electronics and appliance stores down 3.9 percent in December. Shopping at department stores slipped 0.2 percent, while receipts at gasoline stations dropped 1.6 percent.
Reuters and The Associated Press contributed to this report.
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Source: http://bottomline.msnbc.msn.com/_news/2012/01/12/10135202-holiday-season-over-jobless-claims-jump
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