WASHINGTON (AP) — The number of Americans seeking unemployment benefits dropped 9,000 last week to a seasonally adjusted 323,000, near the lowest level since June 2008. The figure shows employers are laying off fewer and fewer workers, an encouraging sign one day before the government will issue its August jobs report.
Weekly applications are just 1,000 above a five-year low reached last month, the Labor Department said Thursday. The four week average, a less volatile measure, declined 3,000 to 328,500. That's the lowest point since October 2007 — two months before the Great Recession officially began.
A private survey released Thursday by the payroll company ADP showed that businesses added 176,000 jobs in August, roughly in line with the monthly average for the year.
Combined, the two reports point to steady improvement in the job market — a fact the Federal Reserve will weigh when it meets later this month to consider whether to slow its monthly bond purchases. Many analysts think the Fed will scale back its bond buying, which has been intended to keep long-term borrowing rates near record lows.
Applications for unemployment benefits are a proxy for layoffs. They have fallen 5 percent in the past two months, raising hopes that hiring could pick up.
"Firms continue to be less concerned about cutting labor costs and may be more comfortable with raising them," said Jonathan Basile, an economist at Credit Suisse.
Economists forecast that the August jobs report will show employers added 177,000 jobs, up from 162,000 in July. The unemployment rate is expected to remain 7.4 percent.
Still, the unemployment rate is well above the 5 percent to 6 percent range associated with a normal economy. In addition, most of the growth this year in the number of people working is due to fewer layoffs rather than strong hiring.