Jobless Claims Rise by 17,000 During Volatile Holiday Period
More Americans filed applications for unemployment benefits for the first time in five weeks, displaying the typical year-end holiday swings that make the data difficult to interpret.
Jobless claims rose by 17,000 to 298,000 in the week ended Dec. 27, from a revised 281,000 in the prior period, a Dec. 31 Labor Department report showed. The median forecast of 22 economists surveyed by Bloomberg News called for 290,000. No states estimated data, and nothing was unusual in the report, a spokesman said.
The number of applications can fluctuate during this time of year as the holidays make it tough to adjust the data for seasonal variations. Employers are dismissing fewer workers and adding staff as household purchases pick up, driven by a drop in gasoline costs that will keep boosting the economic expansion.
“We tend to have some distortions because of the holidays,” said Thomas Simons, an economist at New York-based Jefferies, whose claims estimate for last week was the closest among economists surveyed. “Labor-market conditions are continuing to grind a little bit tighter. It’s moving us closer to the point when we get acceleration in wage growth.”
Last week reflected claims during the Christmas holiday, which may contribute to volatility.
Economists’ estimates in the Bloomberg survey ranged from claims of 275,000 to 315,000. The Labor Department revised the previous week’s figure from an initially reported 280,000.
The four-week moving average, a less volatile measure than the weekly figures, increased to 290,750 last week from 290,500.
The number of people continuing to receive jobless benefits dropped by 53,000 to 2.35 million in the week ended Dec. 20. The unemployment rate among people eligible for benefits held at 1.8%. These data are reported with a one-week lag.
Initial jobless claims reflect weekly firings and typically decline before job growth accelerates.
Monthly payroll increases have averaged almost 241,000 so far in 2014, up from the prior year’s 194,000. The addition of 2.7 million workers to payrolls has put the economy on track for the biggest annual gain in hiring since 1999, and the jobless rate is at a six-year low.
Better employment prospects are buoying Americans’ moods. The Conference Board’s index of consumer confidence rose to 92.6 in December from a revised 91 in November that was stronger than initially estimated, the New York-based private research group said Dec. 30. A measure of current conditions advanced to the highest in almost seven years.
The cheapest fuel costs since 2009 also are lifting household spending, which accounts for about 70% of the economy, and have helped retailers to draw more holiday shoppers. Sales in November and December will gain 4.1%, the most since 2011, the National Retail Federation predicts.
