By Timothy R. Homan and Shobhana Chandra March 18 (Bloomberg) -- Fewer Americans filed first-time claims for jobless benefits last week for the third consecutive time, a sign the labor market is gradually improving along with the economy. First-time jobless applications dropped by 5,000 to 457,000 in the week ended March 13, in line with forecasts, Labor Department figures showed today in Washington. The number of people receiving unemployment insurance increased, and those getting extended benefits also rose. Companies are cutting fewer jobs as sales rise and the economy recovers from the deepest recession since the 1930s. A sustained increase in payrolls is needed for consumer spending, which accounts for about 70 percent of the economy, to accelerate. “Labor-market repair is proceeding at a slow pace,” Michael Feroli, an economist at JPMorgan Chase & Co. in New York, said before the report. “We continue to anticipate a return to net job growth in the months ahead.” Economists forecast weekly claims would fall to 455,000, from a previously estimated 462,000 for the week ended March 6, according to the median of 46 projections in a Bloomberg News survey. Estimates ranged from 440,000 to 465,000. The four-week moving average of claims, a less volatile measure than the weekly figures, decreased to 471,250 last week from 475,500 the prior week, today’s report showed. CPI Report The cost of living in the U.S. was unchanged in February, underscoring the Federal Reserve’s forecast that inflation will remain low as the economy recovers, other figures from the Labor Department also showed. The steady reading in the consumer-price index followed a 0.2 percent gain in January. Excluding food and energy costs, the so-called core index increased 0.1 percent, in line with the median forecasts of economists surveyed. After the reports were released, stock-index futures rose, while longer-term Treasury securities rose. The June contract on the Standard & Poor’s 500 Index rose 1.1 to 1,162.10 at 8:40 a.m. in New York. The yield on 10-year Treasury notes was 3.62 percent, down from 3.64 percent late yesterday. The number of people continuing to receive jobless benefits increased by 12,000 to 4.58 million in the week ended March 6. The continuing claims figure does not include the number of Americans receiving extended benefits under federal programs. Extended Benefits Today’s report showed the number of people who’ve used up their traditional benefits and are now collecting extended payments jumped by about 352,800 to 6.04 million in the week ended Feb. 27. “The labor market is stabilizing,” Federal Reserve policy makers said in their March 16 Federal Open Market Committee statement. At the same time, “employers remain reluctant to add to payrolls,” they said. The unemployment rate among people eligible for benefits, which tends to track the jobless rate, held at 3.5 percent in the week ended March 6, today’s report showed. Twenty-five states and territories had an increase in claims for that same week, while 28 had a decrease. The percentage of Americans who can’t find work is likely to “remain elevated for an extended period,” Treasury Secretary Timothy F. Geithner, White House budget director Peter Orszag and Christina Romer, chairman of the Council of Economic Advisers, said this week in a joint statement to lawmakers. The administration officials said unemployment may even rise “slightly” over the next few months as discouraged workers start job-hunting again. U.S. employers won’t hire enough workers this year to lower the jobless rate much below the level of 9.7 percent reached in February, they said. Job Losses Payrolls in the U.S. declined by 36,000, Labor Department figures showed March 5. The jobless rate has not increased since October. Some companies continue to cut workers. Delta Air Lines Inc.’s regional unit will eliminate 840 jobs in Cincinnati as it consolidates ground operations into a single concourse to reduce costs. The jobs include ramp workers and baggage handlers and represent about 18 percent of the company’s Cincinnati workforce, spokeswoman Kristin Baur said this week in a telephone interview. To contact the reporters on this story: Timothy R. Homan in Washington at thoman1@bloomberg.net; Shobhana Chandra in Washington at schandra1@bloomberg.net

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