Unemployment Benefits Applications Rise to Highest Since August

The number of Americans applying for jobless aid last week rose to the highest level seen since August, although total claims continued their run of coming in under 300,000.

Claims for unemployment benefits increased to a seasonally-adjusted 265,000 last week, the U.S. Labor Department said in Washington on Thursday. The figure, which reflects an increase of 7,000, surpassed analysts’ expectations of 256,000 in claims in a survey by Bloomberg. It was the highest level seen since early August.

However, the latest report showed that the streak of claims coming in below 300,000 was extended to the 87th consecutive week. This is the longest run of such happening since 1970.

In spite of the jobless claims coming in higher than expected, they were still not far removed from an average of 264,000 forecast for 2016. It also showed that employers have lessened their rate of firing.

“The level of claims remains extremely low, signaling that businesses are keen to hang onto staff, presumably because they are fundamentally quite optimistic about business conditions,” Pantheon Macroeconomics’ chief economist Ian Shepherdson said in a research note.

Applications for jobless aid is considered an indicator of rate of dismissals. Low totals show that many employers have cooled down on firing. Unemployment rate in September stood at 5 percent, not very far from what is considered full employment by economists, according to Arkansas Online.

The less-volatile measure of four-week average saw jobless aid claims add 4,750 to reach 257,750. It stood at 253,000 in the week before.

The number of Americans who continued to receive unemployment payments fell to 2.03 million, down by 14,000, in the week ended Oct. 22. That was the lowest seen since June 2000 and 7 percent lower than the number a year ago.

Total claims for the week before the one just reported by the Department of Labor was an unrevised 258,000. The number of jobless aid claims made reached an over four-decade low of 246,000 in the week ended Oct. 1.

Last week, the Commerce Department said the U.S. economy grew at the highest rate in two years during the third quarter. Hiring has, however, slowed in 2016.

This year, an average of 178,000 jobs have been added by employers on a monthly basis, compared to a monthly average of 229,000 in 2015.

Hiring data for October is scheduled to be released by the Labor Department on Friday.

In a survey by the data company FactSet, economists predicted an increase of 170,000 in jobs for October. They see the unemployment rate sliding to 4.9 percent.

The drop in unemployment insurance applications close to all-time lows have contributed to keep total jobless aid claims below the 300,000 mark for over one and half years. Improvement in the claim-filling process and reduction in benefits duration have also contributed, among other factors.

The Labor Department said there were no estimated claims for any state last week.

In a separate report released on Thursday, the department noted that productivity of U.S. workers improved at the highest rate in two years in the third quarter of this year. Labor costs also reduced.