Business Excellence Awards
Please Join PBN to Celebrate the 2014 Business Excellence Award Winners on Novem ...
By Alex Kowalski
WASHINGTON - Fewer Americans filed claims for unemployment insurance payments last week, showing the labor market is starting 2012 on better footing than a year earlier.
Applications for jobless benefits decreased 15,000 in the week ended Dec. 31 to 372,000, Labor Department figures showed Thursday. The median estimate of 38 economists in a Bloomberg News survey forecast 375,000 claims. The average over the past four weeks declined to the lowest level in more than three years.
The decrease in firings indicates employers may be getting more comfortable with their headcounts and their economic outlooks as the year begins. Economists forecast a Labor Department report Friday will show hiring picked up and joblessness held below 9 percent in December.
“The trend continues to be one of improving numbers on the labor market front,” Millan Mulraine, a senior U.S. strategist at TD Securities in New York, said before the report. “We are distancing ourselves from the period of uncertainty which we had over the late summer months and the upswing in claims that came with it.”
Companies added 325,000 workers in December, more than forecast, adding to evidence the labor market was gaining momentum heading into 2012, figures from the Roseland, N.J.-based ADP Employer Services also showed Thursday.
Shares Trim Losses
Stock-index futures trimmed earlier losses after the reports. The contract on the Standard & Poor’s 500 Index maturing in March decreased 0.4 percent to 1,268.4 at 8:34 a.m. in New York.
Claims estimates ranged from 365,000 to 390,000 in the Bloomberg survey. The Labor Department initially reported the prior week’s applications at 381,000.
A Labor Department official Thursday said there were no special issues affecting last week’s figures.
The less-volatile four-week moving average decreased to 373,250, the lowest since June 2008, from 376,500.
The number of people continuing to collect jobless benefits fell by 22,000 in the week ended Dec. 24 to 3.6 million. The continuing claims figure does not include the number of workers receiving extended benefits under federal programs.
Those who’ve used up their traditional benefits and are now collecting emergency and extended payments increased by about 5,400 to 3.5 million in the week ended Dec. 17.
The unemployment rate among people eligible for benefits, which tends to track the jobless rate, dropped to 2.8 percent in the week ended Dec. 24, Thursday's report showed. Forty states and territories reported an increase in claims, while 13 had a decrease.
Initial jobless claims reflect weekly firings and tend to fall as job growth -- measured by the monthly non-farm payrolls report -- accelerates.
“Conditions in the labor market seemed to have improved somewhat,” central bank policy makers noted in the minutes of the Federal Open Market Committee’s Dec. 13 gathering released this week. “Initial claims for unemployment insurance moved down, on net, since early November but were still at a level consistent with only modest employment gains, and indicators of job openings and businesses’ hiring plans were little changed.”
Employers probably increased payrolls by 150,000 workers in December after adding 120,000 the prior month, according to the median forecast of economists surveyed by Bloomberg. The unemployment rate rose to 8.7 percent from 8.6 percent, the lowest level since March 2009, the economists project.
Job cuts announced by U.S. employers rose in December from a year earlier, according to another report Thursday. Planned firings climbed 31 percent to 41,785 last month from 32,004 in December 2010, which was the lowest monthly total in 10 years, according to Chicago-based Challenger, Gray & Christmas Inc.
Government budget cuts and diminished business prospects are still leading companies to trim head counts. Boeing Co. announced yesterday it would close a facility in Wichita, Kansas, that employs more than 2,160 workers. Job cuts will begin in the third quarter of 2012, the Chicago-based planemaker said in a statement.