More Americans than projected filed applications for unemployment benefits last week, bringing a halt to the recent progress in the labor market.
First-time jobless claims rose by 16,000 to 357,000 in the week ended March 23, the highest level in more than a month, Labor Department data showed today in Washington. The median forecast of 48 economists surveyed by Bloomberg called for an increase to 340,000. The four-week average climbed from the lowest level in five years.
Consumer spending has continued to climb even after lawmakers agreed to let the payroll tax rise by 2 percentage points in January, giving employers reason to retain staff. At the same time, stronger economic growth is needed to further reduce the pace of firings, add to payrolls and boost wages.
“We’re not making progress the way we’d like to,” said Robert Brusca, president of Fact & Opinion Economics in New York, who projected claims would climb to 350,000. “It’s still a very disappointing picture for jobs.”
The economy grew at a faster pace than previously estimated in the fourth quarter, reflecting a bigger gain in business spending and a smaller trade gap, a report from the Commerce Department showed today. Gross domestic product rose at a 0.4 percent annual rate, up from a 0.1 percent prior estimate and following a 3.1 percent gain in the third quarter.
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