Fewer workers than forecast filed claims for U.S. jobless benefits last week, a sign the labor market is starting to improve. Applications for unemployment insurance payments rose by 2,000 to 439,000 in the week ended Nov. 13, Labor Department figures showed today in Washington. The total number of people collecting unemployment insurance dropped to the lowest level in two years, while those receiving extended payments climbed. Companies are slowing firings and beginning to pick up the pace of hiring, key to bringing down unemployment from near 10 percent and boosting consumer confidence and spending. Citing a “slow” recovery in employment and output, the Federal Reserve on Nov. 3 announced it would purchase $600 billion in Treasuries through June. “It is indicative of some mild improvement in the labor market,” said Stephen Stanley, chief economist at Pierpont Securities LLC in Stamford, Connecticut. “It’s moving in the right direction, but it still leaves the claims numbers very high.” Stock-index futures held earlier gains after the report on optimism Ireland is on the brink of accepting a bailout to rescue its indebted banks. The contract on the Standard & Poor’s 500 Index maturing in December rose 1.2 percent to 1,191 at 8:40 a.m. in New York. Treasury securities dropped, sending the yield on the benchmark 10-year note up to 2.91 percent from 2.88 percent late yesterday. Better than Projected Jobless benefits applications were projected to rise to 441,000, according to the median forecast of 46 economists in the Bloomberg survey. Estimates ranged from 426,000 to 455,000. The Labor Department revised the prior week’s figure up to 437,000 from the previously reported 435,000. Government offices were closed on Nov. 11 for the Veterans Day holiday, which typically translates to a drop in claims before seasonal adjustment. The decrease this year matched government projections, leading to little change in the adjusted data, a Labor Department spokesman said as the figures were being released. Today’s report corresponds to the week the Labor Department surveys businesses to calculate the monthly payroll figures. The next jobs report is due Dec. 3. The four-week moving average, a less volatile measure than the weekly figures, dropped to 443,000, the lowest level since September 2008, the report showed. Continuing Claims The number of people continuing to receive jobless benefits fell by 48,000 in the week ended Nov. 6 to 4.3 million. The continuing claims figure does not include the number of Americans receiving extended and emergency benefits under federal programs. Those who’ve used up their traditional benefits and are now collecting emergency and extended payments increased by about 121,000 to 4.93 million in the week ended Oct. 30. The unemployment rate among people eligible for benefits fell to 3.4 percent in the week ended Nov. 6, from 3.5 percent in the prior week. Forty-two states and territories reported an increase in claims, while 11 reported a decrease. These data are reported with a one-week lag. Initial jobless claims reflect weekly firings and tend to fall as job growth -- measured by the monthly employment report -- accelerates. That relationship has broken down in recent months as some companies continue to cut staff, while others expand, pointing to an uneven recovery. Payrolls Growing Companies added 159,000 workers to payrolls in October, a fourth consecutive month of more than 100,000 jobs created, even as unemployment held at 9.6 percent, the Labor Department reported on Nov. 5. “Elevated” unemployment and “low” inflation prompted Federal Reserve policy makers this month to announce a second round of large-scale asset purchases. “The unemployment rate is elevated, and measures of underlying inflation are somewhat low, relative to levels” policy makers view as consistent with their mandate, the Fed said in its Nov. 3 statement. Hiring may get a boost as retailers take on extra workers for the holiday shopping season that started this month. Kohl’s Corp., a department store chain, plans to hire about 40,000 people for the holiday period, 21 percent more than last year. Bentonville, Arkansas-based Wal-Mart Stores Inc., the world’s largest retailer, will also ramp up temporary staff. “Hiring for the holidays should be similar to last year,” spokesman Greg Rossiter told reporters last month. Other companies are adding staff as they see a longer-term pickup in demand. Citigroup Inc. plans to hire about 200 bankers by the end of 2011 to court small businesses. “It’s a renewed focus for us,” Raj Seshadri, head of small-business banking for New York-based Citigroup, said in an interview. “We feel we can help business owners and the economic recovery, and there’s money to be made for our shareholders.” To contact the reporter on this story: Bob Willis in Washington at bwillis@bloomberg.net To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net

Source