Applications for unemployment benefits likely rose last week, but still 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.

LITTLE CHANGE: Economists forecast that weekly applications ticked up just 2,000 to a seasonally adjusted 300,000, according to a survey by FactSet.

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Such a small gain wouldn't change the underlying trend: Applications have fallen in the past two months to levels that last existed before the Great Recession began in late 2007. The four-week average dropped to 293,750 earlier this month, the lowest since February 2006.

Applications are a proxy for layoffs. When employers hold onto their workers, it suggests they are more confident in the economy and may be ready to step up hiring.

STEADY JOB GAINS: Falling applications for unemployment aid are among several signs the job market is steadily improving.

Employers have added an average of 230,000 jobs a month this year, up from an average of 195,000 in 2013. Average job gains since February have been the best in eight years.

The unemployment rate ticked up to 6.2 percent in July from 6.1 percent in June. But that was because more Americans began looking for work. Most didn't immediately find jobs, but the rising number of jobseekers suggests that people are growing more confident about their prospects.

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

But hiring has yet to boost wages by much. Wage growth has barely outpaced inflation since the recession ended more than five years ago. Still, the greater the number of people with jobs, the greater the total number of paychecks, which could drive consumer spending and growth.