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The number of Americans filling job applications rose very little in the first two weeks of March, suggesting that the labor market is still improving. Companies continued to hire last week despite recent reports that US economy growth slowed down in the first quarter.
Labor Department reported on Thursday that jobless claims registered a marginal increase of 1,000 to 291,000 in the period stretching from March 8 to March 14 compared to the previous week, while independent reports showed a slightly higher figure of 293,000.
Meanwhile, production output has decreased in the first three months of the year, due do the harsh weather, the dollar strengthening and a very small growth in overseas sales. The Federal Reserve admitted on Wednesday the economy growth downturn and suggested it may soon choose to go for the interest rate increase. As the dollar continued to rise against the euro and the yen, US stocks opened at slightly lower values.
Reports covering a four-week timeline, considered to be more relevant for the labor market than the volatile week-to-week analysis, doubled the initial indications, showing a rise of 2,250 to 304,750 job applications filled. The Fed still seems stubborn on getting more data that the job market is improving before going for any monetary policy regulations.
One of the top forecaster on labor market topics, Jim O’Sullivan, the chief U.S. economist at the High Frequency Economics in New York, believes that while jobless claims remain under the 300,000 figure, consumers’ income should grow at a significant pace. “There’s clear progress in the labor market,” O’Sullivan said. “Employment growth is strong enough for consumer spending to continue to grow solidly.”
In February, the creation of 295,000 more jobs was reported, while over the last 12 months U.S. companies have created 275,000 jobs per month on average, marking the largest growth in employment in the last15 years.
A spokesman for the Labor Department dubbed the latest report as nothing unusual. The report also indicated a significant decrease among the people who are still receiving jobless benefits, down 11,000 to 2.42 million in the first week of March. The drop practically means that people who recently lost their jobs and are eligible for unemployment benefits quickly start searching for a new job rather than remaining on government payroll, and they usually find one too. The unemployment rate among this category is around 1.8 percent.
While they gave up on the “patient” part regarding the interest rate increase, the Fed doesn’t believe the inflation will rise high enough to call for urgent measures. “Labor market conditions have improved further, with strong job gains and a lower unemployment rate,” a spokesman for central bank said in its Wednesday statement.
Among the companies leading employment charts in the US, Ipsen SA, a French company who offers an alternative product for Botox, Allergan Inc.’s wrinkle smoother. Ipsen has a wider array of interests in the medical industry, and recently they started building an oncology clinic, creating 100 jobs, as also as opening a new office in Cambridge, Massachusetts.
Others, like Harley-Davidson Inc., fired 169 of the people working at a factory in Kansas City, and due to industry-specific causes will continue the staff reduction process through September.
US stocks marked an early loss immediately after the report, but the Standard & Poor’s 500 index rose 1.2 percent on Wednesday, after suggestions made by the Fed that the interest rates won’t grow any time soon.
Image Source: Market Watch
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