The number of Americans filing for first-time jobless benefits dropped to the lowest level since the end of November, according to a weekly report from Washington on Thursday, signaling that the U.S. labor market continues to strengthen.
The Labor Department said the initial jobless claims for the week ended January 11 dropped to 326,000 from a revised 328,000 (down from 330,000) the week earlier, marking the lowest level since the week ended November 30, 2013. Economists were expecting claims to total 328,000 last week. The Labor Department said that nothing was unusual in the data and that no states were estimated.
As is typical at through the holiday season, initial jobless claims have hopped up and down erratically because of the impact of holidays making it difficult for seasonal adjustments. On that point, economists tend to put less emphasis on weekly figures until at least the end of January when gyrations tend to flatten out. The data from last week showed claims back down near levels before Thanksgiving.
The four-week moving average, a less volatile measure of labor trends, dropped by 13,500 to 335,000, representing the lowest level in five weeks.
Continuing claims, or those people already collecting state unemployment benefits, for the week ended January 4 rose by 174,000 to 3.03 million. Continuing claims come at a one-week lag to initial claims and don’t include people receiving federal benefits.
The total number of people collecting benefits through all state and federal programs increased by 508,309 to 4.703 million for the week ended December 28. Total claims are delivered at a two-week lag to initial claims. The number of people collecting extended benefits through federal programs rose by about 63,500 to 1.35 million during the period, the last week of emergency unemployment compensation until policy makers on Capitol Hill can come to an agreement about extending the plan that has been in effect for five years. On Tuesday, the Senate did not pass a Democratic proposal to restore extended benefits.
The largest increases in initial claims for the week ending January 4 were in New York (+28,314), Georgia (+18,734) and South Carolina (+9,632). The largest decreases were in Michigan (-17,635), New Jersey (-6,882) and Massachusetts (-5,485).
Although roughly in line with expectations, the fewer claims are somewhat welcome news after a terrible nonfarms payroll report on January 10 that showed the nation only created 74,000 jobs in December. That was the worst monthly performance in almost in nearly three years.
In a separate report on Thursday, the Labor Department said that consumer prices climbed the most in six months during December, mostly because of rising gasoline prices. The agency reported that the Consumer Price Index rose 0.3 percent after no gain in November, in line with economist predictions. Compared to December 2012, the CPI was up 1.5 percent. So-called “core” CPI, which doesn’t include the volatile food and energy components, eked up only 0.1 percent after rising 0.2 percent a month earlier. In the past 12 months, core CPI was up 1.7 percent, keeping the same pace of increase for four straight months.
Stocks on Wall Street are mostly lower on Thursday. With a couple hours left in the session, the Dow is off by 67 points, the S&P 500 is down 3 points and the Nasdaq is essentially flat.