Unemployment Benefits Falls to Lowest Number since 2007

 The U.S. Labor Department’s most recent report on unemployment benefits has found that the number of Americans seeking unemployment aid fell by 15,000 for the week ending August 10, reaching 320,000. This number is the lowest since October 2007 and is a further sign of shrinking layoffs and steady job growth. The four-week average fell by 4,000 to 332,000, the lowest since November 2007 and the fifth consecutive decline. Fewer layoffs has led to a 14 percent drop in unemployment claims this year even though hiring is still sluggish.

About 4.6 million people received unemployment benefits during the week ending July 27, about 66,000 more over the previous week but down by almost 20 percent compared to one year ago. Through June, layoffs averaged 1.6 million per month, even lower than the 1.8 million per month measured during pre-recession 2006. Hiring, however, has not recovered as quickly. Employers hired an average of 4.3 million workers per month through June, below the 5.3 million market in 2006.

Employers have so far added an average of 192,000 jobs per month this year, contributing to a decline in the unemployment rate to 7.4 percent. The economy grew at only a 1.4 percent annual rate during the first half of 2013 though many economists foresee an acceleration in growth to approximately 2.5 percent annual growth during the second half of the year. Consumer spending is expected to rise as the effects of the tax hikes and federal spending cuts diminish.