Weekly jobless claims fall more than expected
The number of Americans filing applications for jobless benefits unexpectedly fell last week, pointing to sustained labor market strength that should continue to underpin the economy.
Initial claims for state unemployment benefits decreased 3,000 to a seasonally adjusted 213,000 for the week ended Jan. 12, the Labor Department said on Thursday. Data for the prior week was unrevised.
Economists polled by Reuters had forecast claims rising to 220,000 in the latest week. The Labor Department said only claims for West Virginia were estimated last week.
The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, slipped 1,000 to 220,750 last week.
The claims data covered the survey period for the nonfarm payrolls portion of January’s employment report.
The four-week average of claims fell 2,000 between the December and January survey periods. While that would suggest little change in labor market conditions after the economy created 312,000 jobs in December, an ongoing partial shutdown of the federal government raises the risk of a drop in payrolls.
Some 800,000 government workers missed their first paycheck last Friday because of the partial shutdown, which started on Dec. 22.
The pay period for most federal employees that includes the week of Jan. 12 runs from Jan. 6 to Jan. 19. About 380,000 workers have been furloughed, while the rest are working without pay. Furloughed workers will probably be counted as unemployed.
Private contractors working for many government agencies are also without pay. The Trump administration has been recalling some employees to work without pay in an effort to minimize the effects of the shutdown.
The longest government shutdown in history has delayed the release of economic data compiled by the Commerce Department’s Bureau of Economic Analysis and Census Bureau, including the housing starts and building permits report, which was scheduled for release on Thursday.
November’s construction, factory orders and trade figures have also been delayed, as well as December retail sales and November business inventories data.
There is a risk the advance fourth-quarter gross domestic report due on Jan. 30 will not be published. The incomplete data is making it hard to get a clear read on the economy, which analysts warn could complicate policy decisions.
The Federal Reserve said on Wednesday in its Beige Book report, which offers a snapshot of the economy, that eight of the U.S. central bank’s 12 districts reported “modest to moderate growth” in late December and early January.
The Fed noted that while outlooks generally remained positive, “many districts reported that contacts had become less optimistic.”
The claims report showed the number of federal employees filing for jobless benefits increased by 5,694 to 10,454 in the week ending Jan. 5. Claims by federal workers are reported separately and with a one-week lag, and are unadjusted for seasonal fluctuations.
The report also showed the number of people receiving benefits after an initial week of aid increased 18,000 to 1.74 million for the week ended Jan. 5. The four-week moving average of the so-called continuing claims rose 8,000 to 1.73 million.