Fewer Americans than forecast filed applications for unemployment benefits last week, easing concern that post-holiday firings were on the rise.
Jobless claims plunged by 50,000 to 352,000 in the week ended Jan. 14, the lowest level since April 2008, Labor Department figures showed today in Washington. The median forecast of 41 economists in a Bloomberg News survey projected 384,000. A Labor Department spokesman said the decrease reflected the usual volatility seen during this time of year.
Companies are slowing the pace of firings and beginning to step up the pace of hiring even as a slump in Europe spurred by a default crisis may limit U.S. growth. The improvement may be a sign that companies are looking to expand their workforces as sales climb.
“Claims are always choppy around the start of a new year but there are simply very few industries left that still need to do any further labor cuts,” Russell Price, a senior economist at Ameriprise Financial Inc. in Detroit, said before the report. “Workers are slowly being added as demand has started to pick up a bit.”
The cost of living was little changed in December for a second month as stores cut prices to boost holiday sales, another report from the Labor Department showed. The median forecast called for a 0.1 percent gain, according to a Bloomberg survey of 78 economists. Excluding (CPUPXCHG) volatile food and fuel costs, the so-called core rose 0.1 percent as projected.
