Fall in Applications for Unemployment Benefits Suggests Improving Job Market
The U.S. Labor Department has reported that unemployment benefits figures are near pre-recession levels as the number of people applying for benefits fell by 21,000 to 323,000 for the week ending November 16. The four-week average, a less volatile measure, fell for the third consecutive week to 338,500. First-time applications have fallen during five of the past six weeks, indicating fewer layoffs.
The consistent declines also suggest that hiring will continue to improve well into 2014. Even with the 16-day partial government shutdown, U.S. employers added 204,000 jobs in October as job growth accelerated throughout Q3. Between August and October, employers added an average of 202,000 jobs per month, up sharply from the average of 146,000 during May through July. Economic growth should benefit from the improvement next year as modest increases in pay coincide with rising hiring rates spurring more spending going into the holiday season.
Almost 3.9 million people received unemployment benefits during the week ending November 2, down about 33,000 from the previous week. That total has also fallen 26 percent over the year and many former recipients are predicted to have found jobs rather than exiting the labor force but most have probably simply used up all benefits available to them. The Federal Reserve continues to monitor the job market to determine when to reduce its bond-buying behavior it adopted to encourage high levels of borrowing and spending.
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