Jobless Claims Little Changed as U.S. Job Market StabilizesShobhana Chandra
The number of Americans filing claims for unemployment benefits was little changed last week, signaling the labor market is stabilizing.
Applications for jobless insurance payments increased by 4,000 to 352,000 in the week ended April 13, in line with the median forecast of economists surveyed by Bloomberg. There was nothing unusual in last week’s data and two states, California and Kentucky, were estimated, a Labor Department official said.
The report indicates employers have enough demand to hold on to workers, which means they may be prepared to boost hiring should sales pick up. Gains in consumer spending, the biggest part of the economy, will be needed to prevent growth from slowing as automatic cuts in federal spending take effect.
“Businesses at least need the workers they have and probably could use some more,” said Tom Simons, an economist at Jefferies LLC in New York, who projected claims would rise to 350,000. “Claims will probably stay in this range for some time.”
Stock-index futures held earlier gains after the report. The contract on the Standard & Poor’s 500 Index maturing in June rose 0.3 percent to 1,551.3 at 8:43 a.m. in New York, indicating the index will rebound from a three-week low.
The median forecast of 46 economists surveyed by Bloomberg called for a rise to 350,000. Estimates ranged from 330,000 to 380,000. The Labor Department revised the previous week’s figure up to 348,000, from an initially reported 346,000.
The four-week moving average, a less volatile measure than the weekly figures, rose to 361,250 last week from 358,500. The figures jumped in late March and then retreated as the government had difficulty adjusting claims for the Easter and school spring break holidays that occurred a little earlier than usual this year.
Last week corresponded to the period the Labor Department surveys businesses to calculate the payroll data for April. The four-week average was higher than the 340,750 for the comparable period in March, reflecting the holiday-induced swings.
Payrolls grew in March by 88,000, the smallest gain in nine months, after a revised 268,000 February increase, the Labor Department reported on April 5. The unemployment rate fell to 7.6 percent, the lowest in four years, from 7.7 percent.
The number of people continuing to receive jobless benefits dropped by 35,000 to 3.07 million in the week ended April 6, today’s report showed.
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 55,000 to 1.78 million in the week ended March 30.
The unemployment rate among people eligible for benefits held at 2.4 percent in the week ended April 6, today’s report showed.
Forty-four states and territories reported an increase in claims, while nine reported a decrease. These data are reported with a one-week lag.
Initial jobless claims reflect weekly firings and tend to fall as job growth -- measured by the monthly non-farm payrolls report -- accelerates.
BlackRock Inc., the world’s largest money manager, is among companies planning to add to payrolls. The New York-based company had reduced its staff by 3 percent in the first quarter.
“We’re hiring to support growth and expect to end the year with meaningfully more people than we began the year,” Ann Marie Petach, former chief financial officer of the company and currently BlackRock Solutions’s senior managing director, said in an April 16 earnings call.
Bigger job gains will help sustain consumer spending, which accounts for about 70 percent of the economy, at a time growth is projected to soften. Gross domestic product may slow to a 1.5 percent annual pace in the second quarter following a projected 3 percent rate in the prior three months, according to the median forecast in a Bloomberg survey from April 5 to April 9.
Federal Reserve policy makers in March reiterated their plan to buy $85 billion in bonds every month until the labor market outlook improves “substantially.” It also pledged to keep interest rates near zero as long as unemployment is above 6.5 percent and inflation doesn’t exceed 2.5 percent.
The economy is projected to cool in part due to $85 billion in automatic across-the-board government budget cuts, known as sequestration, that started March 1. The decline in planned spending, which began because Congress couldn’t compromise on a debt-reduction strategy, trims 5 percent from domestic agencies and 8 percent for the Defense Department this fiscal year.