Employers are holding onto workers in anticipation of a falling U.S. jobless rate that would make it hard to replace those let go.
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In the week ended 1 August initial claims increased by 3,000 to reach 270,000, according to figures published by the Department of Labor. The four-week moving average of jobless claims, a more stable measure of change, dropped by 6,000 to 268,250 last week.
Last week s claims number was a bit better than analysts consensus estimate of 271,000.
On Friday, the Labor Department releases the July jobs report, expected to show the unemployment rate was unchanged at 5.3 percent, a seven-year low.
Jobless claims indicate the number of people who filed for unemployment insurance for the first time and are computed every week. This is the longest stretch since 1972. That’s the lowest level since mid-May and the second smallest reading since the recession ended in 2009. In June, the economy added 223,000 positions for 57 straight months of job creation, and the unemployment rate fell to 5.3%, the lowest level since April 2008.
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“The impacts are expected to be nearly negligible given the size of the announced job cuts relative to the overall labour force as well as the fact that unemployment rates for veterans tend to not be that much different than unemployment rates for non-veterans”, said Daniel Silver, an economist at JPMorgan in New York. It was the 22nd consecutive week that claims held below the 300,000 threshold, which is associated with a strengthening labour market. The majority of economists surveyed by Bloomberg in July favored a September lift-off.
