Washington, DC, United States (4E) – The number of Americans applying for new unemployment benefits dropped last week by more than expected, an indication that the labor market is slowly improving.
In the week ended May 18, jobless claims fell by 23,000 to 340,000, according to data from the Labor Department released Thursday in Washington. This is lower than the median estimate of 345,000 by 50 economists in a survey by Bloomberg News. A spokesman for the Labor Department said that there was nothing special in the data and there were no estimates for the states.
Falling dismissals also resulted for the broader measure of layoffs to hit its lowest level in five years. The four-week moving average of claims, which excludes the volatility of the week-to-week reading, fell by 500 to 339,500 from the revised figure of 340,000 in the previous week.
The decline in claims could lay the groundwork for the acceleration in hiring should the economy hurdle the automatic federal budget cuts that are seen to slow down growth. On Wednesday, Fed Chairman Ben Bernanke said there was still weakness in the labor market, which means policy makers will likely keep the Fed’s asset purchase program aimed to keep borrowing costs low and boost growth.
For the week ended May 11, claims were revised upward from 360,000 to 363,000. Earlier this month, the Labor Department reported that the unemployment rate dropped to 7.5 per cent in April, the lowest rate since 2008.