US jobless claims rebound but hold near historic lows

WASHINGTON: Initial claims for US unemployment benefits rebounded in the latest week, posting the biggest increase in three months, but the average remains near the historic low, the Labor Department reported Thursday.

The data for the week ended December 16 -- collected during the survey week for the key monthly jobs report -- has reporting gaps for Puerto Rico and the Virgin Islands that are still recovering from hurricane damage.

New jobless benefit claims jumped 20,000 to 245,000 last week, snapping a streak of four consecutive weeks of declines, according to the report.

The result far surpassed the increase expected by economists, who projected a more modest rebound to 236,000.

However, the less volatile four-week average rose very slightly to 234,750.

Jobless claims have now held below 300,000 for 146 weeks, or nearly three years, the longest streak since 1970.

Though they can see big swings from week to week, jobless claims are used to gauge the prevalence of layoffs and the health of labor markets.

And despite the overall increase, several states reported declines of more than 1,000 during the week due to fewer layoffs in many sectors.

"Through the volatility, the data continue to signal more than enough strength in employment growth to keep the unemployment rate trending down," said economist Jim O'Sullivan of High Frequency Economics.

The Federal Reserve has for several months noted the widespread reports of labor shortages around the country, as employers face difficulty filling vacant positions with qualified workers.

And as RDQ Economics said in a client note the claims data "continues to point to extreme reluctance on the part of employers to sever workers."