Fewer Americans than forecast filed applications for unemployment benefits as the effects of auto- plant shutdowns began to ebb.
Jobless claims dropped by 24,000 to 334,000 in the week ended July 13, the fewest since early May, from a revised 358,000 the prior period, Labor Department figures showed today in Washington. The median forecast of 49 economists surveyed by Bloomberg projected 345,000. The recent swings reflect the difficulty in adjusting the data for the timing of annual retooling shutdowns at automakers, a spokesman said as the figures were released to the press.
The slowdown in firing must be sustained to lay the groundwork for a pickup in hiring as the effects of a higher payroll tax wane. Bigger job gains will help propel income growth and underpin household spending, the biggest part of the economy.
“The labor market keeps improving,” Robert Stein, a senior economist at First Trust Portfolios LP in Wheaton Illinois, said before the report. “We’re seeing more jobs, we’re seeing more hours, and we’re seeing higher wages. The broader economy is growing still. Firms have been growing in their confidence.”
Stock-index futures extended earlier gains after the report. The contract on the Standard & Poor’s 500 Index maturing in September climbed 0.2% to 1,678.2 at 8:33 a.m. in New York.
Economists’ claims estimates in the Bloomberg survey ranged from 319,000 to 360,000 after an initially reported 360,000 the previous week.
No states estimated jobless claims last week, the Labor Department spokesman said.
The four-week moving average, a less volatile measure than the weekly figures, fell to 346,000 last week from 351,250.
The number of people continuing to receive jobless benefits climbed by 91,000 to 3.11 million in the week ended July 6, the most in five months. That caused the unemployment rate among people eligible for benefits to rise to 2.4%, the highest since early April, from 2.3%.
The continuing claims figure does not include the number of Americans receiving extended benefits under federal programs. Those who’ve used up their traditional benefits and are now collecting emergency and extended payments fell by about 24,200 to 1.64 million in the week ended June 29.