According to US government report, Initial claims for U.S. unemployment-insurance benefits rose in the last week but sustained to signal a healthy labor market.
Report said that the number of people who applied for U.S. unemployment-insurance benefits surged by 3,000 to 244,000 in the week that ended August 5, the Labor Department reported.
Analyst however were predicting the government to report that initial claims for regular state unemployment-insurance benefits surged 2,000 to 242,000.
Meanwhile the average of new claims over the past month, which gives a more stable picture of job loss trends, slowed by 1,000 to 241,000.
Job losses around the country remain exceptionally low. Applications for redundancy benefits have registered 250,000 or less for the last 10 weeks.
Attuned for population growth, claims are at their lowest level ever, said Ian Shepherdson, chief economist at Pantheon Macroeconomics.
The bottom line is companies want to hire more staff but skilled people are more and more difficult to find, Shepherdson said. That dynamic has increased the chances for redundancy as employers are now more prone to ride out small dips in demand without letting go of staff because they fear hiring them if activity picks up will be hard and potentially dear, he said in a research note to clients.
The drop in claims is a signal the job market hasn’t lost drive, said James Glassman, an economist at J.P. Morgan Chase. Nonfarm payrolls have augmented 184,000 every month on average so far this year, not a massive difference from 188,000 year before, he said.
Furthermore the report also said continuing claims dropped by 16,000 to 1.95 million in the week closed July 29.
Moreover the four-week average of continuing claims, which reveals the number of people already on benefits, surged 500 to reach 1.97 million.