- Ian Shepherdson, chief economist at Pantheon Macroeconomics
The number of new applications for unemployment benefits increased last week to reach the highest level since June, but still remained near eight-year lows. Initial claims for jobless benefits rose 11,000 to a seasonally adjusted 315,000 for the week ended September 6, while claims for the previous week were revised upwards to show 2,000 more applications received than previously registered. The four-week average of claims, considered a better gauge of labour market trends as it excludes week-to-week volatility, climbed 750 to 304,000, close to pre-recession levels and consistent with strengthening labour market situation. Report also showed the number of people continuing to apply for unemployment benefits increased 9,000 to 2.49 million for the week ended August 30.
The low level of layoffs is a sign of increased employers' confidence in the economic recovery. Gross-domestic product grew at a seasonally adjusted annual rate of 4.2% in the second quarter after a weather-affected slump in the Q1. Recent data has also pointed to a pickup in business investment and manufacturing activity. However, new hiring by companies has not been strong enough to return employment to levels seen during previous periods of economic expansion. At 6.1%, the nation's unemployment rate remains high by historical standards.
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