Washington, DC, United States (4E) – The number of American workers applying for unemployment benefits for the first time increased last week. However, levels are nearly at five-year lows, a signal that the labor market is improving.
Claims rose by 13,000 to 336,000 from the previous week, in line with the 48 economists’ median forecast in a survey by Bloomberg News. The number in the previous week was revised up by 3,000 to 323,000, which is the lowest level in five years.
In the month ended Aug. 17, four-week moving average of claims fell by 2,250 to 330,500, the lowest level since November 2007, according to a Labor Department report released Thursday in Washington. The figure smooths the week-to-week volatility in data.
Layoffs are declining as employers try to retain their workers to meet sales, which may be a precursor to improvement in payrolls once the impacts of federal government spending cuts and higher payroll taxes are reduced in the second half of the year.
Consumer confidence and spending, which contributes 70 percent to the economy, is boosted by rising employment and personal incomes.
This year, employment growth has been driven by a resurgent housing industry and strengthening consumer spending. The improvement in the job market is a major factor behind the U.S. Federal Reserve’s decision to taper in its $85bn-per-month bond-buying program within the next several months.