U.S. jobless claims drop, point to stronger labor market

Thu Oct 2, 2014 10:57am EDT
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By Jason Lange

WASHINGTON (Reuters) - The number of Americans filing new claims for unemployment benefits unexpectedly fell last week, a sign the labor market may be tightening.

Still, other data on Thursday showed weaker factory orders in August even after stripping out volatile transportation figures, a darker signal for future growth in manufacturing.

Initial claims for state unemployment benefits dropped 8,000 to a seasonally adjusted 287,000 in the week ended Sept. 27, the Labor Department said. Economists polled by Reuters had forecast a rise in new claims.

Claims have fallen steadily since the nation emerged from the 2007-09 recession and are currently lower than they were before the country's economic crisis began. Indeed, the current level is only 8,000 above the 14-year low reached in July.

Thursday's data is "consistent with the continued, solid performance in the labor market," said Keith Hembre, chief economist at Nuveen Asset Management in Minneapolis.

The claims data will have no bearing on Friday's government report on monthly employment during September because the hiring survey was conducted earlier in the month. Economists expect companies stepped up the pace of hiring last month, adding 215,000 workers to payrolls.

Separate data showed U.S. small businesses hiring workers at the fastest pace in eight months, further evidence of strength in the labor market.

The National Federation of Independent Business said its monthly survey of its members found they added an average of 0.24 workers per firm last month, on a seasonally adjusted basis.   Continued...

Job seekers fill out job applications for recruiters as they attend a job fair in New York, June 11, 2013.   REUTERS/Lucas Jackson