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WASHINGTON (AP) — The number of people seeking U.S. unemployment benefits likely stayed near a four-year low last week, as layoffs slow and the job market strengthens.Economists forecast that weekly applications were essentially unchanged, at a seasonally adjusted 360,000, according to a survey by FactSet. That compares to 359,000 two weeks ago, the lowest number of applicants since April 2008.
The labour Department will release the report at 8:30 a.m. Eastern time on Thursday.
The four-week average, a less volatile measure, dipped to 365,000 two weeks ago, the lowest since May 2008. The average has fallen about 12 per cent in the past six months.
When unemployment benefit applications drop consistently below 375,000, it usually signals that hiring is strong enough to lower the unemployment rate.
The decline has coincided with the best three months of hiring in two years. From December through February, employers added an average of 245,000 jobs per month. That has pushed down the unemployment rate to 8.3 per cent, the lowest in three years.
Economists expect another strong month of hiring in March. They forecast that businesses added 210,000 jobs, while the unemployment rate was unchanged. The government will release those figures Friday.
Hiring is picking up as the economy is showing signs of steady growth. Consumer spending jumped in February by the most in seven months, the government said last week.
That’s boosting retailers, restaurants, hotels and other service firms. The service sector expanded at a healthy pace in March, according to a private survey Wednesday. The Institute for Supply Management, a trade group of purchasing managers, said that its survey found that a measure of employment rose to nearly a six-year high.
A separate survey by the ISM of manufacturing companies found that they also stepped up hiring last month, and boosted production.
Companies are investing more, boosting factory output. Businesses ordered more machinery, equipment and other capital goods in February, according to a government report this week.
Yet, greater hiring hasn’t led to bigger paychecks. Americans’ income grew just 0.2 per cent in February, matching January’s weak increase. And after taking inflation into account, income after taxes fell for a second straight month. Consumers have boosted their spending by saving less, which economists worry isn’t sustainable.
Some companies are still letting workers go. Yahoo said Wednesday that it is cutting 2,000 jobs, or 14 per cent of its work force. It is the Internet company’s sixth mass layoff in the past four years.
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