The number of first time applications for unemployment benefits rose last week to the highest level in almost six months.
First-time claims for jobless benefits edged up by 2,000 to a seasonally adjusted 484,000, the Labor Department said Thursday. Analysts had expected a drop. That's the highest total since February.
Initial claims have now risen in three of the last four weeks and are close to their high point for the year of 490,000, reached in late January. The four-week average, which smooths volatility, soared by 14,250 to 473,500, also the highest since late February.
The job losses and sustained unemployment we are experiencing is an indicator that the Great Recession is not over and may even get worse. The number one reason for foreclosure at this point is unemployment and even those who have been able to avoid foreclosure are still struggling to pay their other debts if they are unemployed. And the problem isn't just temporary unemployment that lasts a few months, we're seeing periods of unemployment lasting over a year and in some cases even two years, which is unheard of since the Great Depression. Our current unemployment benefits system is not designed to sustain the numbers of unemployed individuals and the amount of time they remain dependent on the system. And we have no viable safety net setup to catch those who either don't qualify for unemployment benefits or have maxed out their time in the system. For those people, the only answer to their financial troubles is bankruptcy if they have been unable to secure a job that has a living wage. And even if they have secured a job, they may not earn enough to cover those existing debts which have accumulated tons of interests and penalty fees because of their default.