WASHINGTON – More Americans applied for unemployment benefits last week, but applications remain at historically near low levels in a positive sign for the U.S. economy amid a broader global slowdown.
The Labor Department said Thursday that weekly applications for unemployment aid rose 12,000 to a seasonally adjusted 282,000. The four-week average, a less volatile measure, increased 3,250 to 275,500. That average has fallen 9.2 per cent over the past 12 months.
The report points to the resilience of the U.S. economy as international pressures are dampening growth. Employers have largely kept their staffs intact, as applications for jobless benefits, a proxy for layoffs, have remained near 15-year lows for the past several months.
Coupled with steady job growth, the modest number of applications suggests that the economy will continue an expansion that just entered its seventh year, potentially enabling the Federal Reserve to raise interest rates for the first time in nearly a decade.
Economists expect that the government’s latest employment report due out Friday will show the addition of 207,500 jobs in August and a lower unemployment rate of 5.2 per cent from 5.3 per cent, according to FactSet.
Hiring at that pace suggests the U.S. economy has been insulated from uncertainty about China’s financial health, a Canadian economy that just slid into recession, a struggling Europe and the stock market sell-off of the past month.
A private sector jobs survey released Wednesday indicated that employers have weathered the global turmoil and kept hiring in August.
Payroll processor ADP said that businesses added 190,000 jobs last month. This marks an increase from 177,000 in July, but it’s below a six-month high in June of 231,000.
Much of the hiring appears to have occurred at companies with less international exposure. The report found that small businesses with fewer than 50 employees accounted for 85,000 hires in August, while medium businesses with less than 500 employees added 66,000.
The Federal is closely monitoring jobs figures ahead of its next meeting on Sept. 16-17. The unemployment rate is near the level the Fed considers healthy, suggesting the central bank could raise short-term interest rates at that meeting for the first time since 2006.