Applications for unemployment benefits in the U.S. declined to the lowest level in almost two months, showing further healing in the labor market.
Jobless claims in the week ended Nov. 16 dropped by 21,000 to 323,000, the fewest since the week ended Sept. 28, from a revised 344,000 the previous week, the Labor Department said today in Washington. The median forecast of 47 economists surveyed by Bloomberg called for a drop to 335,000. Last week included the Veterans’ Day holiday, which makes adjusting the data for seasonal swings more difficult, a Labor Department spokesman said.
Rising sales going into the holiday-shopping period will probably prompt employers to keep current workers on staff to meet demand. Fewer firings may also lead to bigger gains in hiring that will help boost consumer spending, which accounts for almost 70% of the economy.
“We’re discounting this a little bit, only because some of this is just seasonal noise,” said Omair Sharif, a U.S. economist for RBS Securities in Stamford, Connecticut, who projected a drop in claims to 325,000. “The pace of layoffs hasn’t changed that significantly in the last few months.”
Economists’ estimates in the Bloomberg survey ranged from 323,000 to 360,000. The prior week’s claims were revised up from an initial reading of 339,000.
No states estimated the number of claims for last week, the Labor Department said.
Another report today showed wholesale prices dropped in October for a second month, showing inflation remains tame.
The 0.2% decrease in the producer price index followed a 0.1% fall the prior month, the separate Labor Department report showed. The decline matched the median estimate in a Bloomberg survey of 75 economists. The so-called core measure, which strips out volatile food and fuel, climbed 0.2% after a 0.1% gain in September.
Stock-index futures held earlier gains after the reports. The contract on the Standard & Poor’s 500 Index maturing in December rose 0.2% to 1,783.5 at 8:50 a.m. in New York.
The four-week average of claims, a less-volatile measure, decreased to 338,500 last week from 345,250 the prior week.
The number of people continuing to receive jobless benefits increased by 66,000 to 2.88 million in the week ended Nov. 9.