Tag Archives: Labor Department

U.S. jobless claims drop to near six-month low

FILE PHOTO: People wait in line to attend TechFair LA, a technology job fair, in Los Angeles, California, U.S., January 26, 2017. REUTERS/Lucy Nicholson/File Photo

By Lucia Mutikani

WASHINGTON (Reuters) – The number of Americans filing for unemployment benefits fell to near a six-month low last week, pointing to a further tightening in the labor market that could encourage the Federal Reserve to lay out a plan to start unwinding its massive bond portfolio.

Labor market strength was corroborated by other data on Thursday showing manufacturers in the mid-Atlantic region sharply increased hours for workers in August amid a jump in new orders and unfilled orders.

Initial claims for state unemployment benefits dropped 12,000 to a seasonally adjusted 232,000 for the week ended Aug. 12, the Labor Department said.

That was the lowest level since the week ended Feb. 25 when claims fell to 227,000, which was the best reading since March 1973. Data for the prior week was unrevised.

It was the 128th week that claims remained below 300,000, a threshold associated with a robust labor market. That is the longest such stretch since 1970, when the labor market was smaller. The unemployment rate is 4.3 percent.

Economists polled by Reuters had forecast claims dropping to 240,000 in the latest week. A Labor Department official said there were no special factors influencing the claims data and that 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, fell 500 to 240,500 last week.

Prices of U.S. Treasuries were trading lower as were U.S. stock index futures. The dollar <.DXY> was stronger against a basket of currencies.

LABOR MARKET STRENGTH Last week’s claims data covered the survey week for the August nonfarm payrolls. The four-week average of claims fell 3,500 between the July and August survey periods, suggesting another month of solid job growth.

Payrolls increased by 209,000 jobs in July. The economy has added 1.29 million jobs this year and the unemployment rate has fallen five-tenths of a percentage point.

Labor market tightness has, however, failed to generate strong wage growth, contributing to inflation consistently below the Fed’s 2 percent target.

Minutes of the U.S. central bank’s July 25-26 policy meeting showed policymakers appeared increasingly cautious about weak inflation, with some urging against further interest rate increases.

But labor market strength is probably sufficient for the Fed to outline a proposal to begin offloading its $4.2 trillion portfolio of Treasury bonds and mortgage-backed securities at its next policy meeting in September.

Most economists expect another rate hike in December. The Fed has increased borrowing costs twice this year.

In a second report on Thursday, the Philadelphia Fed said its index of manufacturing in the mid-Atlantic region slipped to 18.9 this month from 19.5 in July.

Despite the modest pullback, manufacturers reported increased demand for their products. The survey’s measure of new orders surged to 20.4 from 2.1 in July. Firms also reported that shipments continued to rise.

As a result, workers put in more hours. The average workweek index increased to 18.8 in August from 3.8 in the prior month.

A third report from the Fed showed manufacturing output fell 0.1 percent in July as the production of motor vehicles and parts tumbled 3.6 percent.

(Reporting by Lucia Mutikani; Editing by Paul Simao)

U.S. jobless claims rise; labor market still tightening

FILE PHOTO: Corporate recruiters (R) gesture and shake hands as they talk with job seekers in Washington, June 11, 2013. REUTERS/Jonathan Ernst/File Photo

WASHINGTON (Reuters) – The number of Americans filing for unemployment benefits unexpectedly rose last week, but the underlying trend remained consistent with a tightening labor market.

Initial claims for state unemployment benefits increased 3,000 to a seasonally adjusted 244,000 for the week ended Aug. 5, the Labor Department said on Thursday.

Data for the prior week was revised to show 1,000 more applications received than previously reported.

Economists polled by Reuters had forecast claims would be unchanged at 240,000 in the latest week. With the labor market near full employment, there is probably limited room for claims to continue declining. Claims have now been below 300,000, a threshold associated with a healthy labor market, for 127 straight weeks. That is the longest such stretch since 1970, when the labor market was smaller. The unemployment rate is 4.3 percent.

Labor market tightness could encourage the Federal Reserve to announce a plan to start unwinding its $4.2 trillion portfolio of Treasury bonds and mortgage-backed securities at its policy meeting next month. A Labor Department official said there were no special factors influencing the claims data and that 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, fell 1,000 to 241,000 last week, the lowest level since May.

The government reported last week that nonfarm payrolls increased by 209,000 jobs in July. The economy has added 1.29 million jobs this year. That has resulted in the unemployment rate dropping five-tenths of a percentage point.

Thursday’s claims report also showed the number of people still receiving benefits after an initial week of aid fell by16,000 to 1.95 million in the week ended July 29. The so-called continuing claims have now been below the 2 million mark for 17straight weeks, pointing to diminishing labor market slack.

The four-week moving average of continuing claims edged up 500 to 1.97 million, still remaining below the 2 million mark for the 15th consecutive week.

(Reporting by Lucia Mutikani; Editing by Paul Simao)

U.S. payrolls increase more than expected, wages rise

By Lucia Mutikani

WASHINGTON (Reuters) – U.S. employers hired more workers than expected in July and raised their wages, signs of labor market tightness that likely clears the way for the Federal Reserve to announce next month a plan to start shrinking its massive bond portfolio.

The Labor Department said that nonfarm payrolls increased by 209,000 jobs last month amid broad gains. June’s employment gain was revised up to 231,000 from the previously reported 222,000.

Average hourly earnings increased nine cents, or 0.3 percent, in July after rising 0.2 percent in June. That was the biggest increase in five months. Wages increased 2.5 percent in the 12 months to July, matching June’s gain.

Average hourly earnings have been trending lower since surging 2.8 percent in February. Lack of strong wage growth is surprising given that the economy is near full employment, but July’s monthly increase in earnings could offer some assurance to Fed officials that inflation will gradually rise to its 2 percent target.

Economists expect the Fed will announce a plan to start reducing its $4.5 trillion portfolio of Treasury bonds and mortgage-backed securities in September.

Sluggish wage growth and the accompanying benign inflation, however, suggest the U.S. central bank will delay raising interest rates again until December. The Fed has raised rates twice this year, and its benchmark overnight lending rate now stands in a range of 1 percent to 1.25 percent.

Economists polled by Reuters had forecast payrolls increasing by 183,000 jobs in July and wages rising 0.3 percent.

Wage growth is crucial to sustaining the economic expansion after output increased at a 2.6 percent annual rate in the second quarter, an acceleration from the January-March period’s pedestrian 1.2 percent pace.

The unemployment rate dropped one-tenth of a percentage point to 4.3 percent, matching a 16-year low touched in May. It has declined four-tenths of a percentage point this year and matches the most recent Fed median forecast for 2017. July’s decline in the jobless rate came even as more people entered the labor force.

The labor force participation rate, or the share of working-age Americans who are employed or at least looking for a job, rose one-tenth of a percentage point to 62.9 percent.

Still, some slack remains in the labor market, which is restraining wage growth. A broad measure of unemployment, which includes people who want to work but have given up searching and those working part-time because they cannot find full-time employment, was unchanged at 8.6 percent last month.

July’s employment gains exceed the monthly average of 184,000 for this year. The economy needs to create 75,000 to 100,000 jobs per month to keep up with growth in the working-age population.

Republican President Donald Trump, who inherited a strong job market from the Obama administration, has pledged to sharply boost economic growth and further strengthen the labor market by slashing taxes, cutting regulation and boosting infrastructure spending.

But after six months in office, the Trump administration has failed to pass any economic legislation and has yet to articulate plans for tax reform and infrastructure spending as well as most of its planned regulatory roll-backs.

The jobs composition in July mirrored June’s. Manufacturing payrolls increased by 16,000 jobs. Employment in the automobile sector rose by 1,600 despite slowing sales and bloated inventories that have forced manufacturers to cut back on production.

U.S. auto sales fell 6.1 percent in July from a year ago to a seasonally adjusted rate of 16.73 million units. General Motors Co and Ford Motor Co have both said they will cut production in the second half of the year.

Construction firms hired 6,000 workers last month. Retail payrolls increased by 900 in July as hiring by online retailers more than offset job losses at brick-and-mortar stores.

Companies like major online retailer Amazon are creating jobs at warehouses and distribution centers. Amazon this week held a series of job fairs to hire about 50,000 workers.

Government payrolls gained 4,000 in July.

(Reporting by Lucia Mutikani; Editing by James Dalgleish and Paul Simao)

U.S. private sector adds 178,000 jobs in July: ADP

A sign advertises manufacturing jobs at Ideal Concrete Block Company in Westford, Massachusetts, U.S., July 17, 2017. REUTERS/Brian Snyder

NEW YORK (Reuters) – U.S. private employers added 178,000 jobs in July, below economists’ expectations, a report by a payrolls processor showed on Wednesday.

Economists surveyed by Reuters had forecast the ADP National Employment Report would show a gain of 185,000 jobs, with estimates ranging from 151,000 to 225,000 jobs added.

Private payroll gains in the month earlier were revised up to 191,000 from an originally reported 158,000 increase.

The report is jointly developed with Moody’s Analytics.

The ADP figures come ahead of the U.S. Labor Department’s more comprehensive non-farm payrolls report on Friday, which includes both public and private-sector employment.

Economists polled by Reuters are looking for U.S. private payroll employment to have grown by 180,000 jobs in July, down from a gain of 187,000 the month before. Total non-farm employment is expected to have increased by 183,000.

The unemployment rate is forecast to tick down to 4.3 percent from the 4.4 percent recorded a month earlier.

(U.S. Financial Markets Team; Editing by Meredith Mazzilli)

U.S. job growth seen accelerating; unemployment rate steady

FILE PHOTO: Leaflets lie on a table at a booth at a military veterans' job fair in Carson, California October 3, 2014. REUTERS/Lucy Nicholson/File Photo

By Lucia Mutikani

WASHINGTON (Reuters) – U.S. employers likely stepped up hiring in June and boosted wages for workers, signs of labor market strength that could keep the Federal Reserve on course for a third interest rate increase this year.

According to a Reuters survey of economists, the Labor Department’s closely watched employment report on Friday will probably show that nonfarm payrolls increased by 179,000 jobs last month after gaining 138,000 in May.

The unemployment rate is forecast steady at a 16-year low of 4.3 percent. It has dropped five-tenths of a percentage point this year and matches the most recent Fed median forecast for 2017.

Economists say labor market buoyancy could also encourage the U.S. central bank to announce plans to start reducing its $4.2 trillion portfolio of Treasury bonds and mortgage-backed securities in September.

“June’s employment report could provide sufficient evidence to Fed officials that they are still positioned to proceed with their monetary policy normalization plans in the second half of the year,” said Sam Bullard, a senior economist at Wells Fargo securities in Charlotte, North Carolina.

The Fed raised its benchmark overnight interest rate in June for the second time this year. But with inflation retreating further below the central bank’s 2 percent target in May, economists expect another rate hike only in December.

June’s anticipated employment gains would be close to the 186,000 monthly average for 2016 and reinforce views that the economy regained speed in the second quarter after a sluggish performance at the start of the year.

But the pace of job growth is expected to slow as the labor market hits full employment. There is growing anecdotal evidence of companies struggling to find qualified workers.

As a result, some companies are raising wages in an effort to attract and retain their workforces. Economists expect worker shortages to boost wage growth, which has remained stubbornly sluggish despite the tightening labor market.

EYES ON WAGES

Average hourly earnings are forecast increasing 0.3 percent in June after gaining 0.2 percent in May. That could lift the year-on-year increase in wages to 2.7 percent from 2.5 percent in May.

“The days of month after month of 200,000 jobs being created are likely behind us,” said Ryan Sweet, senior economist at Moody’s Analytics in West Chester, Pennsylvania.

“We will see trend job growth continue to moderate. That doesn’t necessarily signal that the expansion is running out of juice or that a recession is imminent, it is just a symptom of a full-employment economy.”

The economy needs to create 75,000 to 100,000 jobs per month to keep up with growth in the working-age population.

Republican President Donald Trump, who inherited a strong job market from the Obama administration, has pledged to sharply boost economic growth and further strengthen the labor market by slashing taxes and cutting regulation.

But Republicans have struggled with healthcare legislation and there are also worries that political scandals could derail the Trump administration’s economic agenda.

Job gains were likely broad in June. Manufacturing payrolls likely rebounded after factories shed 1,000 jobs in May. But employment in the automobile sector probably declined further as slowing sales and bloated inventories force manufacturers to cut back on production.

Ford Motor Co has announced plans to slash 1,400 salaried jobs in North America and Asia through voluntary early retirement and other financial incentives. Others, like General Motors are embarking on extended summer assembly plant shutdowns, which will temporarily leave workers unemployed.

Further job gains are likely in construction.

The retail sector is expected to have purged jobs for a fifth straight month as department store operators like J.C. Penney Co Inc, Macy’s Inc and Abercrombie & Fitch struggle against stiff competition from online retailers led by Amazon.

(Reporting by Lucia Mutikani; Editing by Andrea Ricci)

Slow U.S. jobs growth takes shine off dollar, stocks hold all-time highs

A U.S. five dollar note is seen in this illustration photo June 1, 2017. REUTERS/Thomas White/Illustration

By Vikram Subhedar

LONDON (Reuters) – The dollar retreated slightly after disappointing U.S. jobs growth data on Friday though world stocks clung on to record highs, having gained 11 percent so far this year.

Nonfarm payrolls increased 138,000 last month as the manufacturing, government and retail sectors lost jobs, the Labor Department said on Friday.

While the job gains could still be sufficient for the Federal Reserve to raise interest rates this month, the modest increase could raise concerns about the economy’s health after growth slowed in the first quarter.

“This number is not the kind of report that derails the Fed from raising rates in June,” said Tom Porcelli, chief U.S. economist at RBC Capital Markets in New York.

“We’re in a mature phase of the cycle, job growth is going to slow down. The Fed has been talking about this for over a year at this point and they are braced for that reality.”

The dollar index <.DXY>, which measures the greenback’s strength against a basket of major currencies, fell 0.3 percent.

Stock futures on Wall Street trimmed gains slightly and were last trading little changed.

Overnight, data showing a healthy uptick in private sector hiring and factory activity during May bolstered expectations that the U.S. economy was picking up speed and lifted U.S. stocks after two days of losses.

Those gains filtered through to global stocks, lifting the MSCI All-Country World index <.MIWD00000PUS> 0.4 percent to a record high and on track to post a seventh straight week of gains, the longest such run since 2010.

Stocks in Europe joined the party with German bluechips powering ahead to a record, up 1.6 percent. The UK’s FTSE 100 <.FTSE> also hovered near its highest-ever levels rose 0.4 percent.

So far this year investors have pumped $140 billion globally into stock funds, according to fund flow data from Bank of America Merrill Lynch and EPFR showed on Friday.

Global equities attracted $13.7 billion in the latest week to Wednesday, the largest inflows in five weeks, as investors loaded up on risk.

In commodities, however, oil prices resumed their slide with key futures contracts down more than 2 percent amid worries that U.S. President Donald Trump’s decision to abandon a global climate pact could spark more crude drilling in the United States, stoking a persistent glut in global supply.

Global benchmark Brent crude futures <LCOc1> fell to $49.63 a barrel, while U.S. West Texas Intermediate crude <CLc1> by more than a dollar to $47.36 per barrel.

(Reporting by Vikram Subhedar; Editing by Hugh Lawson and Keith Weir)

U.S. jobless claims fall; continuing claims at 28-1/2-year low

FILE PHOTO: Job seekers speak with potential employers at a City of Boston Neighborhood Career Fair on May Day in Boston, Massachusetts, U.S., May 1, 2017. REUTERS/Brian Snyder

WASHINGTON – New applications for U.S. jobless benefits unexpectedly fell last week and the number of Americans receiving unemployment aid hit a 28-1/2-year low, pointing to rapidly shrinking labor market slack.

Initial claims for state unemployment benefits decreased 4,000 to a seasonally adjusted 232,000 for the week ended May 13, the Labor Department said on Thursday. That pushed claims close to levels last seen in 1973.

Data for the prior week was unrevised and claims have now decreased for three consecutive weeks. Economists polled by

Reuters had forecast first-time applications for jobless benefits rising to 240,000.

Claims have now been below 300,000, a threshold associated with a healthy labor market, for 115 straight weeks. That is the longest such stretch since 1970, when the labor market was smaller. The labor market is close to full employment, with the

unemployment rate at a 10-year low of 4.4 percent.

A Labor Department official said there were no special factors influencing last week’s data and only claims for Louisiana 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, fell 2,750 to 240,750 last week, the lowest level since February.

Last week’s claims data covered the survey week for May’s nonfarm payrolls. The four-week average of claims fell 2,000 between the April and May survey periods suggesting further job gains this month. The economy created 211,000 job in April after

adding only 79,000 positions in March.

Labor market strength and tightening could allow the Federal Reserve to raise interest rates next month.

Expectations of a June rate hike have also been supported by data such as retail sales and industrial production, which suggested that economic growth picked up early in the second quarter after rising at an anemic 0.7 percent annualized rate in

the first quarter.

The U.S. central bank increased its benchmark overnight interest rate by 25 basis points in March and has forecast two more increases this year.

Thursday’s claims report also showed the number of people still receiving benefits after an initial week of aid dropped 22,000 to 1.90 million in the week ended May 6, the lowest level since November 1988.

The so-called continuing claims have remained below 2 million for five straight week. The four-week moving average of continuing claims declined 20,000 to 1.95 million, the lowest level since January 1974.

((Reporting by Lucia Mutikani; Editing by Paul Simao))

U.S. jobless claims fall; continuing claims lowest since 1988

FILE PHOTO: A "Now Hiring" sign hangs on the door to the Urban Outfitters store at Quincy Market in Boston, Massachusetts September 5, 2014. REUTERS/Brian Snyder

WASHINGTON – New applications for U.S. jobless benefits unexpectedly fell last week and the number of Americans on unemployment rolls hit a 28-1/2-year low, pointing to a rapidly tightening labor market that could encourage the Federal Reserve to raise interest rates in June.

Initial claims for state unemployment benefits dropped 2,000 to a seasonally adjusted 236,000 for the week ended May 6, the Labor Department said on Thursday. Claims for the prior week were unrevised.

Economists polled by Reuters had forecast first-time applications for jobless benefits rising to 245,000.

Claims have now been below 300,000, a threshold associated with a healthy labor market, for 114 straight weeks. That is the longest such stretch since 1970, when the labor market was smaller. The labor market is close to full employment, with the

unemployment rate at a near 10-year low of 4.4 percent.

Labor market strength, also marked by a sharp rebound in job growth in April, has left financial markets anticipating further monetary policy tightening from the Fed in June.

The U.S. central bank increased its benchmark overnight interest rate by 25 basis points in March and has forecast two more rate hikes this year. The economy created 211,000 job in April after adding only 79,000 positions in March.

A Labor Department official said there were no special factors influencing last week’s data and only claims for Louisiana 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, rose 500 to 243,500 last week.

Thursday’s claims report also showed the number of people still receiving benefits after an initial week of aid tumbled 61,000 to 1.92 million in the week ended April 29, the lowest level since November 1988.

The four-week moving average of the so-called continuing claims fell 27,500 to 1.97 million, the lowest level since February 1974.

((Reporting By Lucia Mutikani; Editing by Andrea Ricci))

U.S. producer prices rise broadly in February

A combine drives over stalks of soft red winter wheat during the harvest on a farm in Dixon, Illinois, July 16, 2013. REUTERS/Jim Young

WASHINGTON (Reuters) – U.S. producer prices increased more than expected in February, and the year-on-year gain was the largest in nearly five years, pointing to a steady rise inflation pressures.

The Labor Department said on Tuesday that its producer price

index for final demand increased 0.3 percent last month after rising 0.6 percent in January. Economists polled by Reuters had forecast a 0.1 percent uptick.

In the 12 months through February, the PPI jumped 2.2 percent, the biggest advance since March 2012 and ahead of the 2.0 percent gain forecast in the Reuters poll. It followed a 1.6 percent increase in January.

Producer prices are rising as the prior weak readings, induced by cheap oil, drop out of the calculation. Crude oil prices have risen above $50 per barrel.

Also boosting price pressures are the dollar’s 1.5 percent drop against the currencies of the United States’ main trading partners since January and overall commodity price gains in tandem with a firming global economy.

A key gauge of underlying producer price pressures that excludes food, energy and trade services increased 0.3 percent in February, the biggest gain since April 2016. The so-called core PPI rose 0.2 percent in January.

Core PPI increased 1.8 percent in the 12 months through February after advancing 1.6 percent in January.

The Federal Reserve has a 2 percent inflation target and tracks a measure that is currently at 1.7 percent. Fed officials were due to start a two-day policy meeting later on Tuesday.

The U.S. central bank is expected to raise its overnight benchmark interest rate by 25 basis points to a range of 0.75 percent and 1.00 percent. It has projected three hikes in 2017.

In February, prices for final demand services increased 0.4

percent, accounting for more than 80 percent of the rise in the PPI. That was the biggest rise since June 2016 and followed a 0.3 percent gain in January.

The cost of energy products increased 0.7 percent last month, slowing from January’s 4.7 percent surge.

Wholesale food prices increased 0.3 percent after being unchanged in January. Healthcare costs rose 0.2 percent after a similar gain in January. Those costs feed into the Fed’s preferred inflation measure, the core personal consumption expenditures index.

The volatile trade services component, which measures changes in margins received by wholesalers and retailers, rose 0.4 percent last month after shooting up 0.9 percent in January.

(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Lisa Von Ahn)

U.S. import prices moderate on cheap fuel

A woman pumps gas at a station in Falls Church, Virginia December 16, 2014. REUTERS/Kevin Lamarque

WASHINGTON, March 9 (Reuters) – U.S. import price increases slowed in February on cheap fuel, but there were signs of a pickup in underlying imported inflation.

The Labor Department said on Thursday import prices rose 0.2 percent last month after an upwardly revised 0.6 percent increase in January. It was the third straight monthly increase.

In the 12 months through February, import prices accelerated 4.6 percent, the largest gain since February 2012, after rising 3.8 percent in January.

Economists polled by Reuters had forecast import prices ticking up 0.1 percent last month after a previously reported 0.4 percent increase in January.

Last month’s moderation in import prices is likely to be temporary amid strengthening global demand that is lifting prices for oil and other commodities.

Prices for imported fuels fell 0.7 percent last month after surging 7.2 percent in January. Import prices excluding fuels rose 0.3 percent. That was the first increase since July and followed a 0.1 percent dip the prior month.

The cost of imported food jumped 1.0 percent last month. Prices for imported capital goods were unchanged after slipping 0.1 percent in January. Imported consumer goods prices excluding automobiles increased 0.2 percent last month after a similar gain in January.

The report also showed export prices increased 0.3 percent in February after gaining 0.2 percent in January. Export prices were up 3.1 percent from a year ago. That was the biggest increase since December 2011 and followed a 2.4 percent rise in January.

Prices for agricultural exports increased 1.4 percent last month, boosted by rising vegetable prices, as well as higher prices for soybeans and corn. Agricultural export prices rose 0.1 percent in January.

(Reporting By Lucia Mutikani; Editing by Andrea Ricci)