AHEAD OF THE BELL:
US unemployment benefits

[May 03, 2012]  WASHINGTON (AP) -- The number of people seeking U.S. unemployment benefits likely fell last week after rising in the past month. A drop in applications would ease concerns that hiring is slowing.

Economists forecast that weekly applications declined 8,000 to a seasonally adjusted 380,000, according to a survey by FactSet. The Labor Department will release the report at 8:30 a.m. Eastern Thursday.

Applications jumped in April after steadily declining since the fall. Weekly applications rose as high as 389,000 last month. The sudden increase pushed the four-week average, a less volatile measure, up to its highest level since the first week of the year.

When applications fall below 375,000, it generally suggests hiring will be strong enough to lower the unemployment rate.

Some economists say temporary layoffs stemming from the spring holidays may have inflated unemployment benefit applications last month.

Still, Thursday's data will be closely watched because it comes one day ahead of the government's report on April hiring. Analysts expect employers added 163,000 jobs in April, while the unemployment rate was unchanged at 8.2 percent.

That would be an improvement from March, when job growth slowed to just 120,000. But it would be below the average 246,000 jobs per month added from December through February.

Many economists had initially downplayed the March figures. They said a mild winter led employers to accelerate hiring in January and February. That made March's job figures weaker. But the rise in unemployment benefit applications has led some analysts to scale back expectations for April hiring.

On Wednesday, a private survey added to that cautious outlook. Payroll provider ADP said companies added only 119,000 jobs last month.

The ADP report has deviated sharply from the government's figures in the past and isn't always a reliable indicator. For example, the government's estimate of 120,000 jobs created in March was much lower than ADP's estimate of 201,000. Most economists said the ADP figures would not lead them to change their forecasts.

Other recent economic data has been more encouraging. A private survey Tuesday found that the manufacturing sector expanded at the fastest pace in 10 months in April. Measures of new orders, production and exports rose. And a gauge of hiring rose to the highest level in nearly a year.

The unemployment rate has fallen to 8.2 percent in March from 9.1 percent in August. Part of the drop was because people gave up looking for work. People who are out of work but not looking for jobs aren't counted among the unemployed.

[Associated Press]

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