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Initial claims for state unemployment benefits dropped 15,000 to
a seasonally adjusted 281,000 for the week ended July 11, the
Labor Department said on Thursday. The decline reversed the
prior week's rise and ended three straight weeks of increases.
Claims tend to be volatile during the summer when automakers
normally shut assembly plants for annual retooling. However,
some of the companies keep production running, which can throw
off a model the government uses to smooth the data for seasonal
fluctuations.
A Labor Department analyst said there were no special factors
influencing the data and no states had been estimated.
The four-week moving average of claims, considered a better
measure of labor market trends as it irons out week-to-week
volatility, increased 3,250 to 282,500 last week.
It was the 16th straight week that the four-week moving average
of claims held below 300,000, a threshold normally associated
with a firming labor market.
While job growth has cooled from last year's robust pace, there
is little doubt that the labor market is tightening.
The current unemployment rate is 5.3 percent, within striking
distance of the 5.0 percent to 5.2 percent range that most
Federal Reserve officials consider consistent with full
employment.
Thursday's claims report showed the number of people still
receiving benefits after an initial week of aid declined 112,000
to 2.22 million in the week ended July 4.
The unemployment rate for people receiving jobless benefits fell
to 1.6 percent, the lowest level since mid-May, from 1.7 percent
the prior week.
(Reporting by Lucia Mutikani; Editing by Paul Simao)
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