Economic growth faster than expected at 2.5 percent

Economists have expressed concern that growth would crawl in the second quarter because of the mixture of spending cuts and tax hikes this year. 

But those forecasts don’t seem to have borne out with growth picking up and the labor market showing consistent gains, although they still aren’t  enough to significantly reduce the unemployment rate.

The Federal Reserve is likely to start tapering its $85 billion a month in monthly stimulus on the steady job creation. The unemployment rate was 7.4 percent last month, and employers added 162,000 jobs, fewer than expected, but keeping the monthly rate right around 200,000 a month.

The August jobs report is due out on Sept. 6.

In a separate report on Thursday, claims for jobless benefits remained near a five-year low as employers held back on layoffs. 

Weekly applications dropped by 6,000 to a seasonally adjusted 331,000, while the monthly average, a better gauge of the labor market’s trajectory, remained steady, increasing by 750 to 331,250, sticking near a 5-and-a-half year low.