The U.S. Labor Department reports on the number of people who applied for unemployment benefits last week at 8:30 a.m. Eastern Thursday.
SMALL RISE: Economists believe applications rose 6,000 to a seasonally adjusted 273,000, according to a survey by the data firm FactSet.
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Even with the increase, applications would remain at a historically low level that signals an improving job market and economy. Weekly applications dropped to 262,000 in April, a 15-year low.
Applications are a proxy for layoffs, so the figures indicate that businesses are confident enough in the economic outlook to hold onto their workers.
GROWTH REBOUND: Fewer Americans seeking unemployment aid is also evidence that the economy's contraction in the first quarter was temporary.
The U.S. economy contracted 0.2 percent at an annual rate in the January-March quarter, the Commerce Department said Wednesday. While better than last month's estimate of a 0.7 percent decrease, the figure was a reminder of the economy's tepid expansion.
Harsh winter weather, a West Coast port labor dispute, and a stronger dollar, which hurt exports, combined to hammer the economy during the first quarter.
But most economists expect those trends to fade, and forecast that growth should rebound to about a 2.5 percent to 3 percent annual rate in the current April-June quarter.
Employers are also hiring at a robust pace, a sign that they expect consumer demand for their products to remain healthy. They added 280,000 jobs in May, above last month's monthly average of 264,000, which was the most in 15 years.
The unemployment rate rose to 5.5 percent from 5.4 percent, but even that contained some good news: more Americans, encouraged by their prospects, started looking for work last month. Not all immediately found jobs, lifting the unemployment rate.
Other data also suggests that the economy is picking up after faltering at the start of the year.
Americans stepped up their spending at retail stores in May, a sign that job growth and cheaper gas prices are finally encouraging more consumers to spend freely. And consumers ramped up their car purchases in May to the fastest sales pace since July 2005.