Jan. 26 (Bloomberg) -- Claims for U.S. jobless benefits rose last week, displaying the usual volatility around holidays that has masked an improvement in the labor market.
Applications for unemployment insurance payments climbed by 21,000 to 377,000 in the week ended Jan. 21, up from an almost four-year low in the prior period, Labor Department figures showed today in Washington. The median forecast of 47 economists in a Bloomberg News survey projected 370,000.
Companies are picking up the pace of hiring as job cuts abate. At the same time, faster job gains are needed to maintain household spending, the biggest part of the world’s largest economy.
“Much of the recent volatility is due to seasonal adjustment issues rather than underlying changes in the labor market,” Steven Wood, president of Insight Economics LLC in Danville, California, said before the report. “Nevertheless, the evidence is clear that the pace of layoffs has slowed.”
Jobless claims were projected to increase from 352,000 initially reported for the prior week, according to the Bloomberg survey. Estimates ranged from 345,000 to 395,000. The Labor Department revised the previous week’s figure up to 356,000.
The four-week moving average, a less volatile measure than the weekly figures, fell to 377,500 last week from 380,000.
A Labor Department spokesman said there was nothing unusual with last week’s data and the government didn’t have to estimate the data for any state. The week included the Martin Luther King Jr. holiday, which may make adjusting the data more difficult.
The number of people continuing to receive jobless benefits climbed by 88,000 in the week ended Jan. 14 to 3.55 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 decreased by about 146,100 to 3.41 million in the week ended Jan. 7.
The unemployment rate among people eligible for benefits, which tends to track the jobless rate, rose to 2.8 percent from 2.7 percent, today’s report showed.
Forty-five states and territories reported a decrease in claims, while eight reported an increase. 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 nonfarm payrolls report -- accelerates.
Payrolls climbed by 200,000 workers in December after rising by 100,000 the prior month, and the jobless rate fell to 8.5 percent, the lowest level in almost three years, Labor Department figures showed on Jan. 6.
The Federal Reserve, tasked by Congress with promoting price stability and full employment, yesterday said it doesn’t foresee an acceleration in the recent decline in joblessness. The central bank’s Federal Open Market Committee said their benchmark interest rate will stay low until late 2014 and anticipate that unemployment will remain high and inflation “subdued.”
“The Committee expects economic growth over coming quarters to be modest and consequently anticipates that the unemployment rate will decline only gradually,” the FOMC said in a statement at the conclusion of their two-day meeting in Washington. “The Committee also anticipates that over coming quarters, inflation will run at levels at or below those consistent with the Committee’s dual mandate.”
Norfolk Southern Corp., the second-biggest railroad in the eastern U.S., said it plans to add to payrolls this year. “We do expect, however, to see increased hiring in engineering and mechanical ranks in 2012,” James Squires, chief financial officer at the Norfolk, Virginia-based company, said on a Jan. 24 conference call with analysts.
--With assistance from Chris Middleton in Washington. Editor: Carlos Torres
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