The economy appears to have grown faster over the summer than first thought, based on a handful of positive September reports on inventory growth and trade released this month. Many economists now predict growth at an annual rate of roughly 3 percent in the July-September quarter, up from the initial estimate of 2 percent reported last month.The government releases its second estimate for third-quarter growth on Nov. 29. Still, many economists say the economy is growing in the current October-December quarter at a weak annual rate below 2 percent. The storm combined with cautious consumers to lower retail sales in October. Consumers may also be holding back because of anxiety over big tax increases and spending cuts â¿¿ known as the "fiscal cliff" â¿¿ that will take effect in January unless Congress and the White House reach a budget deal by then. Many companies are likely to scale back hiring and investment, too, until the fiscal cliff debate is resolved.
WASHINGTON (AP) â¿¿ Superstorm Sandy likely drove more Americans to seek unemployment benefits last week, shuttering businesses in the Northeast and preventing many people from going to work. Economists forecast that weekly applications rose by 14,000 to a seasonally adjusted 369,000, according to a survey by FactSet. The Labor Department will release the report at 8:30 a.m. EST Thursday. Applications fell in the previous week by 8,000 to 355,000. Labor officials said power outages in one state prevented some people from applying for benefits and that the storm could distort the figures through the week ended Nov. 24. People can claim unemployment benefits if their workplaces are forced to close and cannot pay them. Superstorm Sandy hit the East Coast on Oct. 29 and disrupted businesses from North Carolina to Maine. The storm also cut power to roughly 8 million homes and businesses. Some are still without power. Weekly applications have fluctuated between 360,000 and 390,000 since January. At the same time, employers have added an average of nearly 157,000 jobs a month. That's barely enough to lower the unemployment rate, which was 7.9 percent in October. There are some signs that the job market is improving. Employers added 171,000 jobs in October and hiring in August and September was stronger than first estimated, the department said earlier this month. The economy has gained an average of 173,000 jobs a month since July. That's up from 67,000 a month in April through June. The unemployment rate rose slightly in October from 7.8 percent in the previous month because more Americans began looking for work. That suggest some felt their chances of finding a job had improved. Not all of them found jobs, which pushed up the unemployment rate. The government only counts people as unemployed if they are actively searching for work.