6,000 fewer sign up for jobless benefits

Aid rolls fall by 1.63M in past year

WASHINGTON -- The number of Americans filing for unemployment benefits fell last week as the economy's continued improvement tempered dismissals.

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Weekly unemployment benefit applications dropped 6,000 to a seasonally adjusted 289,000, the Labor Department said Thursday. That is the lowest level since late October.

"Labor demand has in fact picked up a bit," Stephen Stanley, chief economist at Amherst Pierpont Securities LLC in Stamford, Conn., said in a research note.

The four-week average, a less volatile measure, declined 750 to 298,750.

Estimates in the Bloomberg survey ranged from 280,000 to 305,000. There was nothing unusual in the data and no states were estimated, a Labor Department spokesman said as the figures were released.

Applications are a proxy for layoffs. The average has fallen nearly 13 percent in the past year, evidence the job market is improving. Companies are cutting fewer jobs as the economy expands and hiring has picked up.

In the first 11 months of this year, employers have added 2.65 million jobs. That already makes 2014 the best year for hiring since 1999.

The figures are "low enough to signal very strong payroll growth," said Ian Shepherdson, chief economist at Pantheon Macroeconomics. The current level of applications is consistent with monthly job gains of about 300,000, he added.

Just 2.37 million people are receiving benefits, down from more than 4 million a year ago. Some former recipients have found jobs, but many have used up all the benefits available to them. A federal extended benefits program expired at the end of last year. Barely a quarter of the 9.1 million people out of work receive unemployment aid.

Still, hiring is accelerating. Employers added 321,000 jobs in November, the most in nearly three years. The unemployment rate held steady at 5.8 percent, down from 7 percent 12 months earlier.

The average hourly wage rose 9 cents to $24.66, the biggest gain in 17 months. Over the past 12 months, hourly pay has risen 2.1 percent, above the 1.3 percent inflation rate.

Other recent data also point to an improving economy. Shoppers spent more in November at retail stores and restaurants, as falling gasoline prices left them with more money to spend on other goods and services.

And factory output rose at a healthy clip last month, fueled by more auto production. Manufacturing output has now surpassed its pre-recession peak.

The labor market has "improved further," the Federal Reserve said Wednesday in a statement after two days of meetings. "Underutilization of labor resources continues to diminish," it said, dropping the word "gradually" used in its previous statement.

Information for this article was contributed by Christopher S. Rugaber of The Associated Press and Nina Glinski, Shobhana Chandra and Chris Middleton of Bloomberg News.

Business on 12/19/2014

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