WASHINGTON – The number of people seeking U.S. unemployment benefits rose 16,000 last week to a seasonally adjusted 326,000. Despite the increase, the number remains close to pre-recession levels and points to stable hiring.
The Labor Department said Thursday that the four-week average of applications, a less volatile measure, inched up 250 to 319,500.
Applications are a proxy for layoffs. They have fallen back to roughly pre-recession levels, an indication that companies are letting go of fewer workers and expect solid economic growth in the months ahead.
The low level of applications for benefits has boosted optimism about how many jobs employers added in March. Weekly claims for unemployment aid have reached a level that is typically consistent with monthly job gains of more than 200,000.
The Labor Department releases its March employment report Friday. Economists project that employers added 191,000 workers last month, according to a survey by FactSet.
That would be an improvement from February, when employers added 175,000 positions. And hiring in February accelerated after winter weather slowed job growth in the previous two months. Snowstorms and freezing temperatures in January and December shut down factories, kept shoppers away from stores and reduced home buying. That cut into growth and hiring. Employers added 129,000 jobs in January and only 84,000 in December.
The unemployment rate rose to 6.7 per cent last month. But the tenth of a percentage point increase happened, in part, for a positive reason: More people entered the job market to look for work. Employers didn’t immediately hire most of them, causing the unemployment rate to increase. But the fact that they started job hunting suggests that Americans are growing more optimistic.
More jobs and higher incomes will be needed to spur better overall economic growth. For now, economists estimate that the bad weather contributed to weak growth of 1.5 per cent to 2 per cent at an annual rate in the January-March quarter. But as the weather improves, most analysts expect growth to rebound to near 3 per cent.