Ahead of the Bell: US Unemployment Benefits
WASHINGTON (AP) — Weekly U.S. unemployment benefit applications likely were little changed last week after falling to a level consistent with modest hiring two weeks ago.
Economists forecast that applications ticked up 1,000 to a seasonally adjusted 345,000, according to a survey by FactSet. The Labor Department will release the report at 8:30 a.m. EDT Thursday.
Last week the department said that applications plunged 42,000 to 346,000, reversing a big gain the previous week that had pushed applications to a four-month high. The roller-coaster readings likely reflected volatility around the Easter holiday, the department said. The holiday's timing varies from year to year, which makes it difficult to adjust for school closings and other seasonal factors that can alter the data.
Still, if the forecast proves accurate and weekly applications remain below 350,000, that could mean the job market is stronger than last month's weak hiring suggested.
Earlier this month the government said that employers added only 88,000 jobs in March. That's a sharp slowdown from the previous four months, when hiring averaged 220,000 per month.
The unemployment rate fell to 7.6 percent from 7.7 percent. But the drop occurred because more people out of work stopped looking for jobs. The government doesn't count people as unemployed unless they are actively looking for work.
Applications are a proxy for layoffs. Any decline in applications would signal that companies are laying off fewer workers.
Still, layoffs are only half of the equation. Businesses also need to be confident enough in the economic outlook to add more jobs. Some economists expect net job gains to pick up to about 150,000 in April.
The economy is expected to grow at a much quicker pace in the January-March quarter than in the final three months of last year. Most economists forecast growth could top an annual rate of 3 percent in the first quarter, up from just 0.4 percent in the fourth quarter.
But many analysts now expect growth will slow in the April-June quarter, mostly because across-the-board government spending cuts kicked in March 1. That may have made businesses nervous about hiring last month.