Applications for unemployment benefits in the U.S. rose to 317,000 last week, holding below this year’s average and signaling sustained progress in the labor market.
Jobless claims climbed by 4,000 in the week ended June 7, a Labor Department report showed today in Washington. The median forecast of 52 economists surveyed by Bloomberg called for 310,000. Claims have averaged around 324,000 so far in 2014.
Faster sales over time would make it easier for those employers whose headcounts are lean to step up hiring. While payroll gains are on pace for their best year since 1999, stronger wage growth is needed to help provide a bigger push for the consumer spending that accounts for almost 70 percent of the economy.
“Relatively low layoffs supported good payroll growth in May,” said Guy Berger, U.S. economist at RBS Securities Inc. in Stamford, Connecticut, who correctly projected claims. Today’s report is “supportive of good employment growth in June.”
Consumers took a break in May after a three-month surge in shopping that has underpinned growth. A 0.3 percent increase in retail sales followed a revised 0.5 percent advance that was much larger than previously estimated, Commerce Department figures showed today.
Stock-index futures were little changed after the reports, with the contract on the Standard & Poor’s 500 Index expiring this month falling 0.1 percent to 1,943 at 8:50 a.m. in New York.
Other Labor Department figures today showed prices of imported goods rose 0.1 percent in May after a 0.5 percent decrease the previous month.
Economists’ estimates in the Bloomberg survey for jobless claims ranged from 300,000 to 340,000 after an initially reported 312,000 in the prior week.
No states were estimated last week and there was nothing unusual in the data, a Labor Department spokesman said as the report was released to the press.
The four-week average of claims, a less-volatile measure than the weekly figure, climbed to 315,250 from 310,500 in the prior week.
The number of people continuing to receive jobless benefits increased by 11,000 to 2.61 million in the period ended May 31. The unemployment rate among people eligible for benefits held at 2 percent during that period, today’s report showed.
More muted firings typically pave the way for acceleration in job growth. Employers added 217,000 workers to payrolls in May, lifting the average monthly advance so far this year to 213,600. If that pace is sustained, job gains in 2014 would be the best since 1999 and exceed the 205,000 average projected in a May 2-7 Bloomberg survey of 77 economists.
An increase in job openings points to further progress in the job market. The number of positions waiting to be filled rose by 289,000 to 4.46 million in April, the highest since September 2007, data from the Labor Department’s Job Openings and Labor Turnover Survey showed earlier this week.
A brighter employment picture is keeping companies such as Dearborn, Michigan-based Ford Motor Co. upbeat about U.S. growth this year.
“While still challenging, labor market conditions have continued to improve modestly,” which will contribute to “positive momentum for the economy in the current quarter and into the second half,” Emily Kolinski Morris, senior U.S. economist at Ford, said on a June 3 conference call.
At the same time, about two-thirds of the labor market indicators that Federal Reserve Chair Janet Yellen monitors haven’t yet returned to pre-recession strength. Still-elevated levels of underemployment and long-term unemployment, and a weaker rate of workers who are comfortable enough to quit their jobs, are among the gauges that remain weaker than 2004-07 averages.
The muted gains are allowing the central bank to continue reductions in monthly asset purchases while maintaining record-low interest rates. The policy-making Federal Open Market Committee in April trimmed its bond-buying by another $10 billion, to $45 billion per month.