Data On Employment And Foreclosures Do Not Hold Out Hope

The news coming in is worse than what was expected

. Data coming in on employment and foreclosures do not hold out hope that the economy is turning. Unemployment is rising and home sales have not picked up.

Many experts feel that the change will not show up until the latter half of this year. Joblessness has already created a record and will continue to worsen till the middle of the next year. More layoffs are taking place.

According to the Labour Department that the first time claims for unemployment benefits jumped to 640,000. In the previous week (starting Monday 13th April) it was 613,000. The analysts had predicted that this week the number would not be more than 635,000.

The National Association of Realtors said that the sale of existing residential houses dropped by 3% in March counting to 4.57 million. In February it was 4.71 million. There is hope that the situation has reached the bottom. Mar Zandi of Moodys Economy said, The economic downturn remains intense, but it is no longer intensifying. We are still falling, but we are no longer crashing. According to Zandi the number of new applications for availing of benefits of unemployment has started to level. The unemployment rate would keep increasing all through this year until 2010.

Patrick Newport of IHS Global Insight continued to paint a gloomy picture about more declines in sales, prices and construction activity. He is anticipating that by the second half of this year the home sales picture will have reached its bottom and pick up showing an increase in affordability. Both prices and mortgage interests are going down and this has made it easier to own a house. But unemployment continues to play spoil sport and things will not improve until next year.

According to IHS unemployment is the worst since the last 25 years. It will reach its highest point of 10.2% by late spring or early summer. The trend shows that in April unemployment will touch 8.9% with employers cutting off another 625,000 jobs. In March joblessness touched 8.5% and 663,000 lost their jobs.

The labour market continues to be weak with more new applicants for unemployment benefits. It increased to 6.13 million setting a high mark for the 12th running week. The jobless benefit rolls are the highest since 1983.

Sales are picking up but mostly from the distressed category. A fresh flood of foreclosures is expected.

by: Karen

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