Unemployment claims jump in wake of attacks

WASHINGTON -- New claims for unemployment benefits rocketed to a nine-year high last week as the terror attacks started showing up in national economic statistics.

The claims are certain to go higher, analysts say, as layoffs and lost business spread.

Separately, the Conference Board in New York said Thursday that newspaper want ads, a key barometer of the job market, had sunk to an 18-year low in August, even before the attacks.

In Washington, the Labor Department reported that for the work week ending Sept. 22, new jobless claims jumped by a seasonally adjusted 58,000, to 450,000, the highest level since July 25, 1992.

Economists believe the increase shows only the first wave of layoffs stemming from the Sept. 11 attacks against the World Trade Center and the Pentagon. For the work week ending Sept. 15, claims actually fell because stunned workers, trying to get their bearings, didn't get around to filing for jobless benefits.

Since the attacks, more than 100,000 layoffs have been announced in the airlines and related industries.

Stan Shipley, economist at Merrill Lynch, predicted that jobless claims will soar to more than 500,000 in the next few months.

With new uncertainties raised by the attacks and prospects the U.S. economy could fall into recession, businesses will be reluctant to hire new workers in the months ahead, economists said.

The nation's unemployment rate shot up to 4.9 percent in August from 4.5 percent, the biggest one-month jump in more than six years.

With consumer confidence being dealt a blow by the attacks, people may feel less inclined to spend on big-ticket items, economists said. That would add to the woes of manufacturers, which have been hardest hit by the more than yearlong economic slowdown, and is likely to slow home sales, one of the economy's few bright spots.