(Updates with economist’s comment in fourth paragraph.)
Oct. 20 (Bloomberg) -- The number of Americans filing applications for unemployment benefits declined last week to a level that shows little improvement in the labor market since the start of the year.
Jobless claims dropped by 6,000 to 403,000 in the week ended Oct. 15, Labor Department figures showed today in Washington. The median forecast in a Bloomberg News survey called for a drop to 400,000 applications. The four-week average fell to the lowest level since April.
Some companies are still paring their workforces at the same time demand has fallen short of the level that may spur businesses to expand staff. The lack of employment growth, which is limiting consumer spending and restraining the recovery, underscores the challenge for President Barack Obama, who is trying to push Congress to pass parts of his jobs initiative.
“We’re running in place,” said Scott Brown, chief economist at Raymond James & Associates Inc. in St. Petersburg, Florida, who projected 405,000 claims. The data are “consistent with lackluster to moderate growth in the job market and the economy,” he said.
The number of people on unemployment benefit rolls rose, while those receiving extended payments fell, today’s report showed.
Jobless benefits applications were projected to decline from 404,000 initially reported for the prior week, according to the median forecast of 46 economists in a Bloomberg survey. Claims at the end of 2010 stood at 418,000. Estimates ranged from 390,000 to 420,000. The Labor Department revised the prior week’s figure up to 409,000.
Stock-index futures held earlier gains after the report. The contract on the Standard & Poor’s 500 Index expiring in December climbed 0.5 percent to 1,212.6 at 8:41 a.m. in New York.
Today’s data showed the four-week moving average, a less volatile measure than the weekly figures, dropped to 403,000 last week, the lowest since the period ended April 16.
The number of people continuing to receive jobless benefits rose 25,000 in the week ended Oct. 8 to 3.72 million. They were forecast to increase to 3.69 million.
The continuing claims figure does not include the number of Americans receiving extended benefits under federal programs.
Those who’ve used up their traditional benefits and are now collecting emergency and extended payments fell by about 68,000 to 3.48 million in the week ended Oct. 1.
The unemployment rate among people eligible for benefits, which tends to track the jobless rate, held at 2.9 percent, today’s report showed.
Forty-nine states and territories reported an increase in claims, while four reported a decrease. These data are reported with a one-week lag.
Initial jobless claims reflect weekly firings and tend to fall as job growth -- measured by the monthly non-farm payrolls report -- accelerates.
Businesses slashing staff include Bank of America Corp., this year’s worst performer in the Dow Jones Industrial Average. The Charlotte, North Carolina-based lender is cutting 30,000 jobs, including at its unit servicing mortgages.
The legacy asset servicing business is “at its peak staffing level,” Chief Financial Officer Bruce Thompson said in a conference call on Oct. 18. “So more of that overall staffing reduction should come through the bottom line.”
Some companies may see more employment over time. Ford Motor Co.’s U.S. hourly workers yesterday voted 63 percent in favor of a four-year contract that creates 12,000 new jobs and gives each as much as $10,000 in payments this year, according to the United Auto Workers.
Obama is seeking to get lawmakers to pass individual provisions of his jobs proposal, after the Senate voted Oct. 10 to block the package of tax cuts and spending aimed to spur employment and economic growth.
--With assistance from Chris Middleton in Washington. Editor: Vince Golle
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