US jobless claims decline for third straight week as labor market tightens

US jobless claims decline for third straight week as labor market tightens

International News

The number of Americans filing for unemployment benefits unexpectedly fell last week, suggesting a rapid tightening of the labor market that bolsters expectations the Federal Reserve will raise interest rates next week. While another report on Thursday showed layoffs announced by U.S.-based employers rising to a seven-month high in November, the overall trend in job cuts remained low. “Layoffs on the part of corporations are few and far between as good help is hard to find this far along in one of the longest economic expansions in the record books,” said Chris Rupkey, chief economist at MUFG in New York. Initial claims for state unemployment benefits slipped 2,000 to a seasonally adjusted 236,000 for the week ended Dec. 2, the Labor Department said on Thursday. It was the third straight weekly decline in claims. Economists polled by Reuters had forecast claims rising to 240,000 in the latest week. Last week marked the 144th straight week that claims remained below the 300,000 threshold, which is associated with a strong labor market. That is the longest such stretch since 1970, when the labor market was smaller. The labor market is near full employment, with the jobless rate at a 17-year low of 4.1 percent. Labor market tightness is seen encouraging the Fed to hike interest rates at the Dec. 12-13 policy meeting. The U.S. central bank has increased borrowing costs twice this year.