The number of Americans filing applications for unemployment benefits rose more than projected during the Christmas week, reaching the highest level in almost six months.
Joblessness claims jumped by 20,000 to 287,000 in the week that ended Saturday, according to a Labor Department report released Thursday. The median forecast of 30 economists surveyed by Bloomberg called for 270,000. Applications haven't been this high since the week that ended July 4.
While there was nothing unusual in the state-level data, the jump could have been caused by the volatility introduced when the numbers are adjusted for seasonal variations, a Labor Department spokesman said as the figures were released. Limited firings, steady hiring and an unemployment rate at a seven-year low underscore job market improvement that allowed the Federal Reserve to lift interest rates last month for the first time since 2006.
"We do have to discount the heightened volatility we have around this time of the year," said Mike Englund, chief economist at Action Economics LLC in Boulder, Colo., who correctly projected the jump. "When the dust settles, we'll see claims drop back down. There will be continued slow improvement in the labor market."
No states had to estimate data last week, according to the Labor Department. Before adjusting for seasonal variations, the increase in claims last week was about typical for that time of year, the agency spokesman said.
Economists' estimates in the Bloomberg survey for weekly unemployment claims ranged from 259,000 to 287,000. The previous week's figure was unrevised at 267,000.
The four-week moving average, a less volatile measure than the weekly claims numbers, increased to 277,000 last week from 272,500.
The number of people continuing to receive benefits rose by 3,000 to 2.2 million in the week that ended Dec. 19. The unemployment rate among people eligible for benefits held at 1.6 percent. These data are reported with a one-week lag.
Initial unemployment claims reflect weekly firings, and a sustained low level of applications has typically coincided with faster job gains. Many layoffs may also reflect company- or industry-specific cases, such as cost-cutting or business restructuring, rather than underlying labor market trends.
Since early March, claims have been below the 300,000 level that economists say is typically consistent with an improving job market.
Data released last month showed the economy added 211,000 workers in November, and the unemployment rate held at 5 percent, the lowest in more than seven years.
Citing improvement in the economy and the labor market, Fed policymakers on Dec. 16 set the new target range for the federal funds rate at 0.25 percent to 0.5 percent, up from zero to 0.25 percent.
Information for this article was contributed by Jordan Yadoo of Bloomberg News.
Business on 01/01/2016