Jobless Claims in U.S. Increased to 339,000 Last Week

Courtesy of Bloomberg: More Americans than forecast filed applications for unemployment benefits last week, underscoring the uneven progress in the labor market.

Jobless claims increased by 8,000 to 339,000 in the week ended Feb. 8 from 331,000 in the prior period, a Labor Department report showed today in Washington. The median forecast of 52 economists surveyed by Bloomberg called for a decrease to 330,000.

Fewer dismissals are needed before hiring can accelerate and provide a bigger boost for consumer spending in the world’s largest economy. Recovery in the labor market is “far from complete,” Federal Reserve Chair Janet Yellen said this week, adding that the central bank would maintain policies that ensure a return to full employment and stable prices.

“The job market isn’t going anywhere quickly,” said Ryan Sweet, senior economist at Moody’s Analytics Inc. and the best forecaster of jobless claims during the past two years, according to Bloomberg data. Looking past the weekly swings in claims data, clearer fiscal policy and improving business confidence means “we’ll start to see hiring accelerate in the spring and summer,” he said.

Economists’ estimates in the Bloomberg survey ranged from 320,000 to 342,000. The prior week’s claims were unrevised.

Retail Sales

A separate report from the Commerce Department today showed retail sales in the U.S. declined in January by the most in 10 months as inclement weather kept some consumers away from auto showrooms and stores. The 0.4 percent decrease followed a revised 0.1 percent drop in December that was previously reported as an increase, Commerce’s figures showed.

The Labor Department’s report showed the four-week average of claims, a less-volatile measure than the weekly figure, increased to 336,750 from 333,250 the week before.

The number of people continuing to receive jobless benefits decreased by 18,000 to 2.95 million in the week ended Feb. 1.

The unemployment rate among people eligible for benefits held at 2.3 percent in the week ended Feb. 1, today’s report showed.

Initial jobless claims reflect weekly firings and typically wane before job growth can accelerate. Barnes & Noble Inc. (BKS) is among those paring staff as revenue at its Nook tablet unit continues to shrink.

Job Cuts

“As we’ve aligned Nook’s cost structure with business realities, staffing levels in certain areas of our organization have changed, leading to some job eliminations,” Mary Ellen Keating, a spokeswoman for the New York-based retailer, said in an e-mail. She declined to say how many jobs were cut and from what areas of the company.

Fed officials are monitoring progress in the labor market as they pursue plans to gradually scale back their bond-buying program, known as quantitative easing.

Yellen, 67, delivered her first public remarks as head of the Fed to the House Financial Services Committee on Feb. 11, days after a Labor Department report showed the jobless rate unexpectedly declined to 6.6 percent, while payrolls growth was weaker than forecast.

By Victoria Stilwell in Washington 

Category: Featured, General Update