Thursday, July 21, 2011

Jobless claims hike in US

New claims for unemployment insurance benefit rises in US

Source: Press TV

New jobless claims rise in the US as the world's largest economy struggles with high deficit amid the government's attempts to raise the debt ceiling.

The number of workers claiming benefits rose by about 10,000 to reach a weekly total of 418,000, the US Labor Department said in a Thursday report.

This is the 15th week in a row where unemployment claims have been above the 400,000 level.

Currently the unemployment rate in the United States stands at 9.2 percent, the worst level since President Ronald Reagan was in office in the 1980s.

However, when measured according to the formula that was used when President Bill Clinton took office in 1993, unemployment rate is around 20 percent.

Meanwhile, Democrats and Republicans have failed to reach an agreement to lift the nation's debt ceiling to avert a government default.

Last week, Standard & Poor's financial services company and Moody's Investors Service put the US AAA rating on formal credit watch, warning there is a chance of downgrade if talks between the White House and Republicans on raising the debt limit remain stalemated.

The US debt ceiling is capped at USD 14.3 trillion, up from USD 10.6 trillion when US President Barack Obama took office in 2009, and the administration says that if it is not elevated by August 2, the government would default on its obligations.

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