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Jobless data suggest improving employment market

The number of Americans applying for unemployment benefits rose back above 400,000 last week.
/ Source: news services

The number of Americans applying for unemployment benefits rose back above 400,000 last week. Still, the average number of applications over the past four weeks fell to its lowest level since mid-April — that suggests the job market may be improving.

Separately, a report on consumer inflation showed Americans paid more last month for gas, food and clothes, pushing prices up by the most since March.

A woeful manufacturing survey from the Federal Reserve Bank of Philadelphia was also a worry.

Its main indicator of factory activity slid to minus a near two and a half year low of 30.7 in August from a positive 3.2 reading in July. The slide suggests a recession is well and truly in prospect in the Philadelphia region — anything below zero indicates a contraction in activity.

"This was obviously a terrible report, and, if sustained, readings like these would be consistent with recession," said Joshua Shapiro, chief U.S. economist at MFR Inc.

The Labor Department says weekly jobless claims applications rose 9,000 to a seasonally adjusted 408,000, the highest level in four weeks. Applications have been above 400,000 for 18 of the past 19 weeks.

The four-week average, a less volatile measure, dropped for the seventh straight week to 402,500.

Still, applications below 375,000 typically are consistent with healthy job growth. The last time they were that low was in late February.

Last week's figure was revised up to 399,000. That was the first time they had fallen below 400,000 since early April.

The Labor Department said its Consumer Price Index rose 0.5 percent in July, following a drop of 0.2 percent in June. Gas prices accounted for much of the swing. They increased by a seasonally adjusted 4.7 percent after dropping sharply in June.

The core index, which excludes volatile food and energy, rose 0.2 percent. That's below the 0.3 percent rise in each of the previous two months.

Prices are 3.6 percent higher than they were a year ago, matching the 12-month increase in May and June. Core prices are 1.8 percent higher than they were a year earlier, the largest increase in two years.