Jobless Claims Declined More Than Forecast Last Week
Fewer Americans than forecast filed for unemployment benefits last week, a sign labor market momentum continues to strengthen.
Jobless claims declined by 12,000 to 267,000 in the period ended June 13, the lowest since the week ended May 9, a Labor Department report showed June 18.
The median forecast in a Bloomberg News survey of economists called for 277,000 new applications. The figure corresponds to the week the government surveys employers to calculate the monthly payroll data.
The low level of firings indicates employers are optimistic demand will firm as the world’s largest economy rebounds from a first-quarter slowdown.
“If someone was just looking at jobless claims, they would think the U.S. has reached full employment,” Thomas Costerg, a senior U.S. economist at Standard Chartered Bank in New York, said before the report. “There’s still some hidden slack in the labor market, but it is diminishing quite quickly.”
Applications for jobless benefits have held below 300,000 for 15 straight weeks. Estimates from 48 economists in the Bloomberg survey for claims ranged from 265,000 to 290,000. Filings in the prior week were unrevised at 279,000.
No states estimated jobless claims last week and there was nothing unusual in the report, an agency spokesman said as the figures were released.
The four-week average of claims, a less-volatile measure than the weekly figure, dropped to 276,750 from 278,750 the week before.
The number of people continuing to receive jobless benefits decreased by 50,000 to 2.22 million in the week ended June 6.
In that same period, the unemployment rate among people eligible for benefits held at 1.7%, the report showed.
Initial jobless claims reflect weekly firings and typically decrease before job growth can accelerate. Many layoffs now reflect company- or industry-specific causes, such as cost-cutting or business restructuring.
Gap Inc. is among companies trying to cut costs as it struggles to boost revenue. The clothing retailer this week said it will close 175 of its namesake stores in North America as part of a comeback plan for the business, which has posted sales declines for five straight quarters and lagged behind its sister chain Old Navy. The company is also eliminating 250 corporate jobs as part of the move.
