July 6, 2012

U.S. jobless aid applications drop to six-week low as hiring picks up

The Associated Press

WASHINGTON - Fewer people applied for U.S. unemployment benefits last week, and a private survey showed hiring picked up in June. The reports offered some hope for the job market after three sluggish months of hiring.

Weekly unemployment benefit applications dropped by 14,000 to a seasonally adjusted 374,000, the Labor Department said Thursday. That's the fewest since the week of May 19.

Separately, payroll provider ADP said businesses added 176,000 jobs last month. That's better than the revised total of 136,000 jobs it reported for May and, if sustained, would be enough to lower the unemployment rate.

"We're actually seeing some better news on the U.S. jobs front," said Jennifer Lee, an economist at BMO Capital Markets, in a note to clients. Unemployment aid applications have fallen for two straight weeks. The back-to-back drop of 18,000 is the largest two-week decline since February, she noted.

The data sketched a picture of a slowly improving job market one day before the government reports on hiring in June. Economists are predicting 90,000 jobs were added last month, while the unemployment rate stood at 8.2 percent.

The ADP survey has often deviated sharply from the government report, so economists approached the June results with some caution.

In May, the Labor Department said employers added just 69,000 jobs, the fewest in a year and nearly half ADP's estimate. The ADP report only covers hiring in the private sector and excludes government job growth.

And most other recent economic indicators have been disappointing.

 

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