The fewest Americans in almost 15 years filed applications for unemployment benefits during a holiday-shortened week that typically makes the data more volatile.
Jobless claims plunged by 43,000 to 265,000 in the week ended Jan. 24, the lowest since April 2000, a Labor Department report showed Jan. 29 in Washington. The median forecast of 51 economists surveyed by Bloomberg News called for 300,000. The week included the Martin Luther King holiday, which makes the data more difficult to calculate, a government spokesman said as the report was released.
Firings probably will remain muted and companies will keep adding to payrolls as rising consumer confidence and spending help the U.S. economy withstand waning overseas demand. Federal Reserve policy makers yesterday boosted their assessment of the economy as the job market improved and fuel costs dropped.
Estimates in the Bloomberg survey ranged from 270,000 to 315,000. The Labor Department revised the prior week’s reading to 308,000 from an initially reported 307,000.
No states were estimated last week and, while there was nothing unusual in the data, the holiday-shortened workweek means there were fewer days for government employees to crunch the numbers, making them more volatile, the Labor Department spokesman said.
The four-week average of claims, a less-volatile measure than the weekly figure, dropped to 298,500 from 306,750 in the prior week.
The number of people continuing to receive jobless benefits declined by 71,000 to 2.39 million in the week ended Jan. 17. The unemployment rate among people eligible for benefits held at 1.8% during that period, the report showed. These data are reported with a one-week lag.
The figures aren’t yet showing that the energy price plunge has prompted more firings in the U.S. fuel belt. No state reported an increase of more than 1,000 in claims for the week ended Jan. 17, the report showed.
Sustained muted firings typically aid a pickup in job growth. The labor market is coming off its best year since 1999, with employers finishing the year adding 252,000 to staffs in December. Almost 3 million jobs were added in 2014 as the jobless rate declined to 5.6%, a more than six-year low.
The U.S. central bank’s policy-making Federal Open Market Committee on Wednesday described the expansion as “solid,” an improvement over the “moderate” performance it saw in December. It also substituted “strong” for “solid” in its evaluation of job gains after a meeting Jan. 29 in Washington.
Progress in employment, combined with a sustained drop in fuel prices, is bolstering household balance sheets and keeping U.S. growth humming.
The average cost of a gallon of regular gasoline was $2.04 on Jan. 28, down from $3.68 in late June, according to data from motoring group AAA. That price at the pump hasn’t risen on any day since September.
Consumer spending is projected to have grown at a 4% pace in the last three months of 2014, the most in a year.
Not all companies have been immune to firings. Deere & Co., the largest manufacturer of agricultural machinery, is preparing to let go staff in Iowa and Illinois as the outlook for global orders weakens. The Moline, Illinois-based company plans to dismiss about 910 workers, according to a statement issued last week.