The number of Americans applying for unemployment aid climbed 14,000 during the New Year holiday week, the first increase in a month but in line with expectations, a government report showed Thursday.
First-time initial claims for jobless aid rose to 353,000 in the week ended Jan. 3, up from an unrevised 339,000 in the previous week, the Labor Department said. Wall Street economists polled by Reuters had forecast claims to rise to 350,000.
“Jobless claims were not much different from what we were looking for, although the overall level of continued claims drifted back down, an encouraging sign,” said Steve Ricchiuto, chief U.S. economist at ABN AMRO Inc.
The more widely watched four-week moving average, a better gauge of labor market trends because it irons out weekly fluctuations, fell 5,500 to 350,250. That was the lowest in nearly three years, since the moving average dropped to 345,250 in the week ended Feb. 3, 2001.
The number of people continuing to draw a week of benefits dropped by 12,000 to 3.27 million in the week ended Dec. 27, the latest week for which data are available. The four-week moving average of that barometer fell to its lowest since Sept. 22, 2001.
“Jobless claims were higher than expected at 353,000, but you have to keep in mind that this is still a pretty good number for the economy and signals that the job market certainly is stronger than it was throughout most of 2003,” said Patrick Fearon, an economist for A.G. Edwards & Sons.
“This is a figure that is consistent with a growing economy and an improvement in the labor market,” he said.
A rise in the number of people filing for state jobless claims does not tarnish the picture of a steadily improving labor market.
A more accurate picture of the economy is likely to emerge with Friday’s release of the December employment report, which is expected to show a hefty rise in payroll jobs last month.
According to a Reuters poll, analysts estimated that the economy generated 130,000 new jobs in December, accelerating from a rise of 57,000 reported for November.
Overall claims, which inched lower during the fourth quarter of 2003, could keep a lid on a 5.9 percent U.S. jobless rate for December.
The job market, which is likely to be a key issue in the 2004 presidential election, has lagged other areas of the economy on its way to recovery. Since President Bush took office in January 2001, 2.3 million jobs outside the farm sector have been lost.
