WASHINGTON — As bad as it is already, the economy keeps getting worse — and government figures Thursday provided more evidence that the downward spiral won’t end anytime soon.
The number of Americans seeking unemployment benefits topped 5 million for the first time since record-keeping began in 1967. And the number of first-time claims hit 667,000, the highest level in more than a quarter-century. Both figures were worse than experts expected.
Orders for cars, computers, machinery and other durable goods plunged a larger-than- expected 5.2 percent in January as global economic troubles reduced demand from customers at home and abroad.
“We have been looking for signs that the economy’s rate of decline might be slowing but can’t find any,” said Nigel Gault, chief U.S. economist at the IHS Global Insight consulting firm.
The government reports offered more evidence that consumers are scaling back purchases as jobs vanish, home prices drop and stock portfolios shrink. Those factors fuel more job and spending cuts by profit-starved businesses.
“The hope is that policy efforts by the federal government will be able to break that cycle,” said Zach Pandl, an economist at Nomura Securities International. “But it’s still going to take some time before that happens.”
President Barack Obama’s $787 billion stimulus package, for example, includes billions of dollars of infrastructure spending, but most of the impact will not be felt until 2010 or later, Pandl said.
The four-week average of initial jobless claims rose to 639,000, the highest in more than 26 years. And the number of people claiming benefits for more than one week reached 5.1 million, the highest total on records dating to 1967 and the fifth straight week that continuing claims have reached a new high.
