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Job seekers wait to speak to a representative during a Coast-to-Coast Career Fair in Chicago, Illinois.
The number of Americans filing for unemployment benefits fell last week for the first time in a month, the latest indication of labor market strength that is sustaining economic growth.
Initial claims for state unemployment benefits dropped 3,000 to a seasonally adjusted 247,000 for the week ended July 8, the Labor Department said on Thursday. Data for the prior week was revised to show 2,000 more applications received than previously reported.
Claims have now been below 300,000, a threshold associated with a healthy labor market, for 123 straight weeks. That is the longest such stretch since 1970, when the labor market was smaller. The labor market is near full employment, with the jobless rate at 4.4 percent.
The drop in first-time applications for jobless benefits came on the heels of data last week showing the economy created 222,000 jobs last month, the second biggest payrolls increase this year.
Labor market buoyancy could persuade the Federal Reserve to increase interest rates for a third time this year by December, despite inflation continuing to stubbornly run below the U.S. central bank’s 2 percent target.
The Fed’s survey of the economy published on Wednesday showed “labor markets tightened further for both low and high-skilled positions, particularly in the construction and IT sectors.”
Economists expect the Fed will announce in September a plan to start reducing its $4.2 trillion portfolio of Treasury bonds and mortgage-backed securities.
The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, rose 2,250 to 245,750 last week.