Applications for unemployment benefits rose only slightly in the week ending Oct. 17, staying near the ultra-low levels that have provided confidence about the jobs recovery in recent months.
First-time claims for unemplyoment insurance rose by only 3,000 to 259,000, the Department of Labor reported Thursday, ticking up by less than expected. That numbers was just above the the unrevised 255,000 recorded the week before, which was the lowest mark in over four decades.
The four-week moving average for first-time claims, meanwhile, fell to 263,250, the lowest such number since Dec. 15 of 1973, when Richard Nixon was president and the labor force was only three fifths the size it is today.
The small numbers of people applying for jobless benefits at state offices suggests that layoffs are increasingly rare. Recently, the jobless claims data, which is updated weekly, has been one of the brightest economic indicators amid mixed signals from the U.S. economy.
As unemployment has receded, however, it’s possible that fewer people are bothering to apply for benefits when they’re laid off, meaning that low jobless claims are less predictive of jobs growth than in the past. Economists have begun wrestling with that question as the claims numbers have scraped decades-lows.
Thursday’s release is particularly noteworthy because it covers the week that will be used to calculate the monthly jobs report for October, due out Nov. 6. The Obama administration will be looking for a better jobs report than the last two, which have both disappointed with payrolls growth under 145,000.
Officials at the Federal Reserve will also factor the low jobless claims number into their monetary policy meeting in Washington, D.C. next week. Chairwoman Janet Yellen and other members have said that they need to see “some further improvement” in the jobs outlook as well as evidence that inflation is rising to their 2 percent goal as they prepare to tighten monetary policy.
Although most investors do not expect the Fed to make a major decision at the October meeting, many do expect the central bank to raise interest rates from zero for the first time since 2008 at the December meeting.
The numbers released Thursday show the extent of recovery. Through Oct. 10, there were 1,861,554 people receiving benefits of all durations, which are available for up to 26 weeks. That datapoint was down from over 2 million the year before.
