WASHINGTON: The number of Americans filing new claims for unemployment benefits fell last week and job cuts declined sharply in December, suggesting the labour market is tightening.
Reports support views of faster growth this year, driven by consumer spending, despite a faltering global economy.
In a separate report, global outplacement consultancy Challenger, Gray & Christmas said the number of job cuts announced by US employers fell 9.2 percent in December.
For the whole of 2014, employers announced a total of 483,171 job cuts. That was 5 percent fewer than in 2013 and the smallest number since 1997.
“This bodes well for job seekers who will not only find more employment opportunities in 2015, but will enjoy increased job security once they are in those new positions,” said John A Challenger, chief executive officer of Challenger, Gray & Christmas.
“Labour market conditions continue to improve, providing support for consumers and contributing to a virtuous cycle for the economy,” said Jim Baird, chief investment officer at Plante Moran Financial Advisors in Kalamazoo, Michigan.
Initial claims for state unemployment benefits slipped by 4,000 to a seasonally adjusted 294,000 for the week ended Jan. 3, the Labor Department said.
While that was a bit less than Wall Street’s expectations of a drop to 290,000, the trend in claims remained consistent with a steadily tightening labor market.
At current levels, claims probably have little room to fall further. “Claims have never dropped below the 280,000-290,000 range in the last 20 years, reflecting the reality that a certain number of layoffs is a natural part of the growth/lifecycle of companies even in the best of times,” said Anthony Karydakis, chief economic strategist at Millar Tabak in New York. Reuters
