March 24 (Bloomberg) -- Fewer Americans filed applications for unemployment benefits last week, signaling the labor market is mending.
Jobless claims declined by 5,000 to 382,000 in the week ended March 19, Labor Department figures showed today in Washington, in line with the median forecast of economists surveyed by Bloomberg News. The total number of people receiving benefits dropped to the lowest level in almost three years.
Waning firings and a pickup in hiring are helping to ensure gains in consumer spending, which accounts for about 70 percent of the economy. The report is consistent with Federal Reserve policy makers’ assessment that the economic recovery is on a firmer footing, even as they said the unemployment rate remains “elevated.”
“The labor market recovery is on track,” said David Semmens, a U.S. economist at Standard Chartered Bank in New York. “The unemployment rate will see a slow-but-steady grind down.”
Orders for long-lasting goods unexpectedly fell in February, reflecting declines in demand for capital goods and military aircraft, a report from the Commerce Department also showed today. Bookings for goods meant to last at least three years dropped 0.9 percent after a 3.6 percent gain the prior month that was larger than initially reported.
Stock-index futures trimmed earlier gains after the reports. The contract on the Standard & Poor’s 500 index maturing in June rose 0.6 percent to 1,299.3 at 8:36 a.m. in New York. It had been as high as 1,302.7 before the data.
Jobless benefits applications were projected to fall to 383,000 from 385,000 initially reported for the prior week, according to the median forecast of 48 economists in a Bloomberg survey. Estimates ranged from 370,000 to 395,000. The Labor Department revised the prior week’s figure up to 387,000.
There was “nothing unusual” in last week’s data, a Labor Department spokesman said as the figures were released to reporters. The report “appears to be clean,” he said. Claims for one state, Alaska, were estimated.
The four-week moving average, a less volatile measure than the weekly figures, fell to 385,250 last week, the lowest level since July 2008, today’s data showed.
The number of people continuing to receive jobless benefits dropped by 2,000 in the week ended March 12 to 3.72 million, the fewest since September 2008.
The continuing claims figure does not include the number of Americans receiving extended benefits under federal programs.
Those who’ve used up their traditional benefits and are now collecting emergency and extended payments decreased by about 13,000 to 4.34 million in the week ended March 5.
The unemployment rate among people eligible for benefits, which tends to track the jobless rate, was 3 percent for a fourth consecutive week.
Thirty-eight states and territories reported a decline in claims, while 15 reported an increase. These data are reported with a one-week lag. New York saw the biggest drop in claims, almost 17,000, as fewer transportation and services industries fired staff.
Initial jobless claims reflect weekly firings and tend to fall as job growth -- measured by the monthly non-farm payrolls report -- accelerates.
“The economic recovery is on a firmer footing, and overall conditions in the labor market appear to be improving gradually,” Fed officials said in a statement after their meeting on March 15. “Currently, the unemployment rate remains elevated.”
The jobless rate fell in February to 8.9 percent, the lowest since April 2009 and the third straight monthly decline, Labor Department figures showed March 4. More seasonable weather helped boost payrolls by 192,000, the most since May. Employment figures for March are due on April 1.
Improving demand is encouraging some companies to take on more employees, cushioning earlier cutbacks. General Motors Co. will recall the last of its laid-off workers by September, United Auto Workers Vice President Joe Ashton said yesterday.
“We only have about 2,000 people now laid off and those people will all be back to work in September,” Ashton, who handles negotiations with GM, told union workers at the UAW’s Special Convention on Collective Bargaining in Detroit. A GM spokeswoman said the company wasn’t predicting when it would complete recalling laid-off workers.
Since October, the Detroit-based car maker has announced plans to add shifts and a combined 1,350 jobs to assembly plants in Flint and Lansing, Michigan. An additional 1,550 workers will be retained at a factory in Orion Township, Michigan, scheduled to reopen this year.
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