Labor Market

In this crummy job market, Stephanie Yang figures any little advantage will help. Even double eyelids. So on a cold January morning, the 21-year-old college senior walked into one of dozens of plastic surgery clinics here and plopped down $730, the equivalent of one year's tuition. An hour later she came out with two big bandages over her eyes. When she removed the dressing the next day, Yang was aghast at her red, puffy eyelids.

European markets fell and Asian markets were mixed Friday as investors digested uneven readings on the U.S. economy and oil prices that remained near records. Japan posted its 12th straight day of losses. Trading was subdued as U.S. financial markets were closed for the Fourth of July holiday. In Europe, Britain's FTSE-100 closed down 1.2% to 5,412.8, Germany's DAX fell 1.3% to 6,272.21, and France's CAC-40 slid 1.8% to 4,266.

The U.S. housing market has still not reached bottom, the number of workers drawing jobless benefits has hit a 2 1/4 -year high and consumers are tightening their purse strings, reports showed Thursday, suggesting that the economy may have screeched to a halt. Pending sales of previously owned homes fell 1.5% in December and were off a sharp 24% from a year earlier, the National Assn. of Realtors said.

Mariam, a 28-year-old retail chain employee, went to great lengths to get fired. Knowing she would be ineligible for unemployment payments if she simply quit, Mariam asked her company to fire her, but she was turned down. Then she simply stopped showing up for work. Her wish was granted at last -- she was fired, went on the dole and found a new job six months later. Soon, such convoluted yet surprisingly common schemes may be a thing of the past.

Fewer people signed up for jobless benefits last week, an encouraging sign that most companies aren't resorting to large-scale layoffs as the country copes with continuing problems in the housing and credit markets. The Labor Department reported Wednesday that new applications filed for unemployment insurance dropped by a seasonally adjusted 11,000 to 330,000 for the week ended Nov. 17. It was the lowest level since the beginning of November.

U.S. consumer prices rose briskly last month on energy costs, but aside from volatile energy, inflation was largely contained, possibly leaving room for the Federal Reserve to cut interest rates to bolster a slowing economy. A second government report Thursday showed an unexpectedly steep rise in initial claims for jobless benefits last week, a suggestion that the labor market is softening as the economy lumbers under the weight of a housing downturn, tighter credit and higher energy prices.

The stock market ended the first week of the third quarter with a respectable gain Friday, shaking off early losses as investors found signs of strength in the government's June employment report. For the most part, investors were relieved to hear that the unemployment rate held steady at 4.5% in June for the third straight month, as expected, and that 132,000 jobs were added -- fewer than in May but slightly higher than the average forecast.

Fewer U.S. workers signed up for unemployment aid last week, underscoring stability in the labor market, and inventories at U.S. wholesalers picked up in April in a sign businesses are preparing for more demand later this year. The number of U.S. workers signing up for first-time unemployment benefits slipped by 1,000 to a seasonally adjusted 309,000 for the week ended June 2, the Labor Department reported.

The U.S. economy should expand only slightly in coming months as it continues to lose steam, a gauge of future growth showed Thursday. But a resilient labor market indicates the economy remains generally healthy, economists said. The Conference Board said its index of leading economic indicators climbed a tepid 0.1% to 137.4 in March, as expected. The index is designed to forecast economic activity over the next three to six months. The latest reading reverses two consecutive months of declines.

A surprise drop in the number of new claims filed for jobless aid pointed to a healthy U.S. labor market, but a forward-looking measure of the economy showed that momentum had slowed, according to data released Thursday. Initial filings for state unemployment insurance aid fell for the third straight week and to the lowest level in six weeks, dropping to 316,000 in the week that ended March 17 from an upwardly revised 320,000 for the prior week, according to the Labor Department.