Jobless Claims Drop to 14-Year Low
Applications for unemployment benefits in the U.S. unexpectedly dropped last week to their lowest level in 14 years as employers avoided trimming staff even as global growth weakens.
Jobless claims decreased by 23,000 to 264,000 in the week ended Oct. 11, the fewest since April 2000 and lower than any projection in the Bloomberg News survey of economists, a Labor Department report showed. There was nothing unusual in the data and no states were estimated, a spokesman said as the figures were released.
The labor market is showing an “improving trend,” Millan Mulraine, deputy head of U.S. research and strategy at TD Securities USA said. “Businesses feel, at worst, comfortable with their employee ranks and at best, looking at hiring.”
The median forecast of 49 economists surveyed by Bloomberg projected the number of claims would increase to 290,000 last week. Estimates ranged from 280,000 to 300,000. The prior week’s reading was unrevised at 287,000.
The four-week average of claims, a less-volatile measure than the weekly figure, declined to 283,500, the lowest since June 2000, from 287,750 in the prior week.
The number of people continuing to receive jobless benefits rose by 7,000 to 2.39 million in the week ended Oct. 4. The unemployment rate among people eligible for benefits held at 1.8% during that period, today’s report showed.
A sustained drop in firings typically coincides with a pickup in hiring. Employers added 248,000 workers to payrolls in September, according to Labor Department data. The unemployment rate fell to 5.9%, the lowest since 2008. Job gains stayed on pace for their best year since 1999.
Economists project the progress in employment will help mend household balance sheets and lift consumer purchases. That spending, the biggest part of the economy, is poised to grow 2.7% next year after a 2.3% gain in 2014, according to the latest Bloomberg survey of economists.
