Claims for unemployment benefits drop as labor market improves
The report comes a day ahead of the government’s report for January — forecasts for job growth last month between 145,000 and 155,000 jobs with an unchanged unemployment rate of 8.5 percent. The economy added 200,000 jobs in December.
ADP, a private employment services firm, said on Wednesday that the private sector added 170,000 jobs last month.
A survey by The Associated Press says the economy will add about 160,000 jobs a month this year — about 1.9 million jobs — up from 135,000 last year.
That figure isn’t enough to make a dent — more than 13 million are still unemployed and millions have stopped looking for a job — and that is weighing on the ability for consumers to spend at a pace to repair the economy.
Without that spending, businesses are slow to add new employees, and without money in their pockets, consumers will continue tempering their spending.
Workers who have exhausted their 26 weeks of state benefits and are now receiving federal unemployment insurance — up to 73 additional weeks in some states — increased by about 43,100 to 3.5 million for the week that ended Jan. 14.
Lawmakers on Capitol Hill are working on a plan that would extend federal benefits through the rest of the year, although there is disagreement on the length, provisions such as drug testing and how to pay for the extension.
Overall, 50 states and territories reported a drop in claims, while three said there was an increase — a signal that the labor market is improving across the nation.
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