Improved employment outlook could ease debt woes for many

11.05.09
By Nicholas Storie

New government statistics show a moderate drop in the number of Americans filing for first-time unemployment benefits, suggesting that job creation could slowly be picking up.

According to the Department of Labor, 512,000 workers filed for benefits last week, down from 532,000 the previous week. A Bloomberg News report noted the number of people receiving benefits fell to levels last seen in March, although some of this may be explained by more people having exhausted their benefits.

The news service also said that economists expected the unemployment statistic to fall to 522,000 this week, which made the actual figure something of a surprise.

However, the national unemployment rate is still widely expected to exceed 10 percent in the coming months and remain at that level until well into 2010.

While it remains to be seen how "jobless" the pending recovery will be, economists are also watching consumer spending rates as a potential measure of future growth.

The Commerce Department recently reported that the personal savings rate last month reached 3.3 percent of disposable income, up from 2.8 in August. Personal consumption expenditures decreased as well in September.

Looking ahead, lagging consumer confidence could make the coming holiday shopping season a disappointment for the retail sector, which could translate into slower economic growth to start off 2010. Still, the recent report of an improved gross domestic product could be another sign of a steadily-improving economy.

Another positive sign was noted in a New York Times report this week which cited a 1.8 percent increase in retail sales at stores open for at least one year.

Millions of workers are cautiously watching for signs of an economic recovery, focusing more on savings and debt management in the process.

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An improved employment outlook could help more people with personal debt issues.