WASHINGTON – More people sought U.S. unemployment aid last week, but applications are still at a low level consistent with steady job growth.
THE NUMBERS: The Labor Department said Thursday that weekly applications for unemployment benefits rose 6,000 to a seasonally adjusted 265,000. The four-week average, a less volatile figure, increased just 250 to 259,750. The number of people receiving benefits fell to 2.18 million from 2.22 million the previous week. That is 8.3 per cent lower than a year earlier.
THE TAKEAWAY: Applications are a proxy for layoffs, so the data indicates that businesses are holding tightly onto their staffs, despite overseas economic turmoil and modest growth in the U.S.
Applications have been below 300,000, a historically low level, for 55 straight weeks, the longest stretch since 1973. Many businesses say they are having trouble finding new employees with the skills and experiences they need, so that may contribute to their reluctance to lay off any of their current staff.
KEY DRIVERS: When businesses are cutting few workers, they are more likely to step up hiring. Employers added a healthy 242,000 jobs last month, while the unemployment rate remained at 4.9 per cent.
Modest consumer spending growth and some recovery in housing is sustaining the U.S. economy, even as weakness overseas and cutbacks in business spending has dragged down manufacturing.
In a separate report Thursday, the Commerce Department said that orders for big-ticket manufactured goods fell 2.8 per cent in February. The drop was led by a sharp decline in orders for commercial aircraft.
Still, excluding transportation goods, orders fell 1 per cent, a sign that manufacturing may struggle for a second year after a weak 2015.
Sales of existing homes dipped in February, but followed two solid readings in December and January. And new home sales rose 2 per cent last month, though all the increase occurred in the West.