U.S. Jobless Claims Fall to 49-Year Low as Market Tightens

(Bloomberg) -- Filings for U.S. unemployment benefits unexpectedly dropped, falling to the lowest level since October 1969 and suggesting little sign of cooling in a tight labor market.

Jobless claims decreased to 196,000 in the week ended April 6, Labor Department figures showed Thursday. The level fell below all estimates in Bloomberg’s survey of economists, which had called for an increase. The four-week average, a less-volatile measure, declined to 207,000, the lowest since December 1969.

Key Insights

• The fourth-straight drop in claims indicates the labor market remains historically firm as employers still find it hard to attract and hire workers amid low unemployment.
• The report comes a day after Federal Reserve officials signaled they’re prepared to move interest rates higher or lower as needed, but an unusual mix of risks means they could remain on hold all year. The March jobs report showed employers added 196,000 jobs, bouncing back from a weak 33,000 advance the prior month.
• In separate data Thursday, March producer prices excluding food and energy -- a key input into U.S. inflation -- increased 0.3 percent from the prior month, more than forecast, and climbed 2.4 percent from a year earlier, matching estimates.
• Elsewhere Thursday, another report showed the Bloomberg Consumer Comfort Index edged up on advances across all three major components, which track views of Americans on the state of economy, personal finances, and the buying climate.

What Bloomberg’s Economists Say

“The labor market is very tight. Jobless claims unexpectedly declined again to the lowest level since 1969. Employers are adding jobs at a pace that is well above the natural growth rate of the labor force and job openings continue to exceed the number of job seekers.”
- Eliza Winger, economist

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• A Bloomberg survey of economists had forecast claims would rise to 210,000.
• Continuing claims, which are reported with a one-week lag, dropped by 13,000 to 1.713 million in the week ended March 30.
• The unemployment rate among people eligible for benefits held at 1.2 percent.
• The previous week’s claims were revised up to 204,000 from 202,000.

--With assistance from Chris Middleton.

To contact the reporter on this story: Reade Pickert in Washington at epickert@bloomberg.net

To contact the editors responsible for this story: Scott Lanman at slanman@bloomberg.net, Jeff Kearns

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