Applications for unemployment benefits likely rose last week, but remain at low levels

MarketsAssociated Press

The U.S. Labor Department reports on the number of people who applied for unemployment benefits last week. The report will be released Thursday at 8:30 a.m. Eastern.

MODEST INCREASE: Economists forecast that weekly applications edged up 2,000 to a seasonally adjusted 300,000, according to a survey by FactSet. But even with that slight increase, jobless claims have fallen this summer to levels that predate the start of the Great Recession at the end of 2007.

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The four-week average for unemployment benefits has been 299,750, which close to the lowest level in more than eight years.

Applications are a proxy for layoffs. When employers keep their workers, it indicates that they are more confident about economic growth and could be ready to step up hiring.

CONTINUED JOB GAINS: Falling applications for unemployment benefits have been pointing to an improving job market.

The Labor Department will release the August employment report Friday. Employers are expected to have added 220,000 jobs in August, according to FactSet. Economists also project that the unemployment rate ticked down to 6.1 percent, from 6.2 percent.

If hiring meets or exceeds these expectations, it would be the seventh straight month of job gains of more than 200,000. The last time U.S. posted a streak that long was also in 2007.

Employers have added an average of 230,000 jobs a month so far this year, up from an average of 195,000 in 2013.

And employers in June advertised the most monthly job openings in more than 13 years, the government said last month.

Rising optimism about jobs and hiring helped boost consumer confidence to nearly a seven-year high in August, according to the Conference Board, a research group.

The percentage of respondents who said jobs were "plentiful" rose to 18.2 percent from 15.6 percent in July. That's the highest level since 2008. Consumer perceptions generally track the unemployment rate over time.

Still, hiring has yet to boost wages by much. Wage growth has barely outpaced inflation since the recession ended more than five years ago. But as more people land jobs, there should also be more paychecks, which could drive consumer spending and growth.