The number of Americans filing for unemployment benefits was little changed last week, near the lowest level in seven years as employers held on to staff in an improving economy.
Claims decreased by 1,000 to 298,000 in the week ended Aug. 23 from 299,000 in the prior period, the Labor Department reported. The median forecast of 46 economists surveyed by Bloomberg News called for an increase to 300,000.
Claims have been hovering near the lowest levels since 2007 as the labor market continues to make progress. Now, it’s up to hiring to cut slack enough to force employers to raise pay, which, in turn, could spur more household spending.
“Businesses are feeling better about the economic outlook,” said Ryan Wang, an economist at HSBC Securities USA Inc. “The improvement in the job market is also helping with consumer confidence.”
Estimates in the Bloomberg survey ranged from 280,000 to 315,000. The prior week’s claims were revised up from an initial reading of 298,000.
The four-week average of claims, a less-volatile measure than the weekly figure, declined to 299,750 from 301,000 the week before.
The number of people continuing to receive jobless benefits climbed by 25,000 to 2.53 million in the week ended Aug. 16.
Initial jobless claims reflect weekly firings and typically decrease before job growth can accelerate. The timing and extent of closings to re-tool auto factories for the new model year can cause claims to swing during the summer, yet claims remained low by historical standards this year, even as job growth has accelerated.
U.S. employers added more than 200,000 workers to payrolls in July for a sixth straight month, the first streak of that length since 1997. Employment climbed by 209,000 after a 298,000 gain in June, while the jobless rate rose to 6.2 percent as more Americans began hunting for work.