Published 12:00 am Thursday, March 13, 2014
WASHINGTON — The number of people seeking U.S. unemployment benefits dropped 9,000 last week to a seasonally adjusted 315,000, its lowest level in three months. It was the second straight decline, and it added to evidence that the job market is picking up after a winter slump.
The Labor Department said Thursday that the four-week average of applications, a less volatile figure, fell 6,250 to 330,500, the lowest point since early December.
Applications are a rough proxy for layoffs. The declines indicate that most companies are confident enough about consumer demand to avoid layoffs.
Employers are also hiring more after harsh winter weather depressed job gains in January and December, the government said last week. The economy gained 175,000 jobs last month, up from just 129,000 in January and only 84,000 in December.
“We are encouraged by this report,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, said in a note to clients, “because it supports the idea that the recent gyrations in monthly labor market indicators…have been driven by the weather.”
About 3.45 million people received unemployment benefits as of Feb. 22, the latest period for which figures are available. That’s 13,000 more than in the previous week.
In a separate report Thursday, the Commerce Department said sales at retail stores and restaurants rose 0.3 percent last month. The rebound shows that consumers are spending a bit more after sales fell a sharp 0.6 percent in January.
The unemployment applications and retail sales suggest that the economy is recovering after severe weather caused auto sales to dip, factory orders to fall and sales of existing homes to plummet.
The unemployment rate ticked up last month to 6.7 percent from 6.6 percent, but the increase occurred partly for a good reason: More people started looking for jobs. Most weren’t immediately hired, thereby boosting the unemployment rate. But the fact that they started job hunting suggests they were optimistic about their prospects.
The weather did force about 6 million people with full-time jobs to work part-time in February. Many of their paychecks will shrink, likely weighing on spending.
That’s one reason economists forecast that growth will slow to an annual rate of 2 percent or less in the first three months of this year, down from a 2.4 percent rate in the final three months of last year. But as the weather improves, most analysts expect growth to rebound to an annual rate near 3 percent.