First-time claims for jobless benefits probably rose last week from an almost three-year low, a pause in the improvement in the U.S. labor market, economists said before a report today.
Initial applications for unemployment insurance climbed by 8,000 to 376,000 in the period ended March 5, according to the median forecast in a Bloomberg News survey. The gain would be the second in the past eight weeks. It would follow the previous week’s level of 368,000 claims, which were the fewest since May 2008. Separate figures may show a wider trade deficit in January on costlier imported oil.
The rebound in the world’s largest economy has limited firings, paving the way for employers such as Boeing Co. (BA) and Home Depot Inc. (HD) to add jobs and spur household spending. While American companies ship more goods abroad, stronger domestic demand and surging energy prices point to a bigger import bill, curbing the contribution to growth from trade.
“Demand has improved and we’re now in a stage where companies are starting to execute on hiring,” Russell Price, a senior economist at Ameriprise Financial Inc. in Detroit. “The improvement in the labor market is by far the biggest plus for the economy. That’s what we really need to get self-sustaining growth.”
The Labor Department figures are due at 8:30 a.m. Estimates of 49 economists in the Bloomberg survey ranged from 355,000 to 410,000. The report may also show the total number of people getting unemployment insurance decreased.
Also at 8:30 a.m., the Commerce Department will issue trade data. Economists project a $41.5 billion shortfall for January after a $40.6 billion gap a month earlier. Estimates for the deficit ranged from $46 billion to $39 billion.
On the Mend
Recent reports add to evidence the labor market is on the mend. The jobless rate fell in February to 8.9 percent, the lowest since April 2009 and the third straight monthly decline, Labor Department figures showed last week. More seasonable weather helped boost payrolls by 192,000, the most since May.
Initial jobless claims reflect weekly firings and tend to fall as job growth — measured by the monthly non-farm payrolls report — accelerates.
“We believe that we are in a continued positive economic recovery that will lead to positive labor growth over the course of the next couple of years,” Carl Camden, chief executive officer at Troy, Michigan-based temporary staffing provider Kelly Services Inc., said Feb. 24 at a conference in Boston. “We see strength in U.S. conditions.”
Temporary Hiring
Companies taking on staff include Atlanta-based Home Depot. The world’s largest home-improvement retailer in February said it is hiring more than 60,000 temporary workers in the U.S., and adding permanent employees for the second year in a row.
Boeing began “change incorporation” work on the 787 Dreamliner in San Antonio, Texas, where 450 employees will be hired on a temporary basis to join 1,700 experienced workers at the site to complete the work, the Chicago-based planemaker said on March 7.
Federal Reserve policy makers will likely keep interest rates near zero and maintain plans to buy $600 billion in Treasury securities by June to boost growth as they await additional signs of sustained job creation. Fed Chairman Ben S. Bernanke said employment data are encouraging.
“We do see some grounds for optimism about the job market over the next few quarters, including notable declines in the unemployment rate in December and January, a drop in new claims for unemployment insurance, and an improvement in firms’ hiring plans,” Bernanke said March 1 during testimony before lawmakers.
Limited Improvement
Still, the labor market “has improved only slowly,” and it may take “several years” for the unemployment rate to reach a “more normal level,” he said guaranteed high risk personal loans.
While stocks have gained this year amid signs employment is picking up along with the economy, they’ve been restrained by surging oil prices. The Standard & Poor’s 500 Index is down 0.5 percent so far this month.
The tax compromise reached by President Barack Obama and congressional Republicans in December has resulted in bigger paychecks that are helping support demand even as fuel costs rise. Costlier oil, which this week reached a 29-month high in New York, also will lead to higher imports. At the same time, exports of American-made goods, aided by a weaker dollar and expansion in developing economies like China, may help limit growth in the trade deficit.
Bloomberg Survey ============================================================== Trade Initial Cont. Federal Balance Claims Claims Budget $ Blns ,000’s ,000’s $ Blns ============================================================== Date of Release 03/10 03/10 03/10 03/10 Observation Period Jan. 5-Mar 26-Feb Feb. ————————————————————– Median -41.5 376 3750 -225.2 Average -41.4 377 3759 -225.3 High Forecast -39.0 410 3820 -190.0 Low Forecast -46.0 355 3700 -243.6 Number of Participants 74 49 16 26 Previous -40.6 368 3774 -220.9 ————————————————————– 4CAST Ltd. -42.2 383 — -223.0 ABN Amro -41.5 355 — — Action Economics -41.0 390 3820 -223.0 Aletti Gestielle -42.0 380 — — Ameriprise Financial -41.0 370 3720 — Banesto -41.1 — — — Bank of Tokyo- Mitsubishi -41.7 381 — -225.0 Barclays Capital -42.0 380 — -225.0 BBVA -41.0 370 3740 -227.5 BMO Capital Markets -41.7 380 3765 -232.5 BNP Paribas -41.8 380 — -240.5 BofA Merrill Lynch -41.5 375 — -235.0 Briefing.com -41.5 370 3750 -223.0 Capital Economics -41.0 — — — CIBC World Markets -41.0 — — — Citi -41.5 375 3810 -220.0 ClearView Economics -42.0 — — — Commerzbank AG -42.0 360 — — Credit Agricole CIB -41.0 — — — Credit Suisse -41.0 400 — — Daiwa Securities America -42.0 — — -190.0 DekaBank -40.5 — — — Desjardins Group -41.9 385 — — Deutsche Bank Securities -41.0 — — — Deutsche Postbank AG -39.0 — — — First Trust Advisors -42.2 372 — — FTN Financial -42.0 — — — Goldman, Sachs & Co. -41.5 — — -235.0 Helaba -41.5 375 — — Horizon Investments -40.0 — — — HSBC Markets -40.7 370 — — Hugh Johnson Advisors -39.0 — — — Ibersecurities -41.8 — — — IDEAglobal -41.0 380 — -235.0 IHS Global Insight -40.1 — — — Informa Global Markets -41.5 375 3785 -223.0 ING Financial Markets -42.0 365 3700 -243.6 Insight Economics -42.0 395 3750 — J.P. Morgan Chase -42.0 375 — -226.0 Janney Montgomery Scott -41.9 — — — Jefferies & Co. -41.0 375 — -225.0 Landesbank Berlin -46.0 — — — Landesbank BW -41.4 378 — — Manulife Asset Management -41.5 372 3725 — Maria Fiorini Ramirez — 365 — — MF Global -41.5 380 — -230.0 Mizuho Securities -42.0 410 — — Moody’s Analytics -42.4 385 3780 — Morgan Keegan & Co. -41.3 — — — Morgan Stanley & Co. -42.5 370 — -220.0 National Bank Financial -40.5 — — — Natixis -42.2 — — — Nomura Securities Intl. -39.9 — — -192.0 Nord/LB -41.5 370 — — Parthenon Group -40.7 378 — — Pierpont Securities -42.0 373 — -220.0 PineBridge Investments -42.0 388 — — PNC Bank -42.0 — — — Raiffeisenbank International -40.8 — — — Raymond James -41.2 378 — — RBC Capital Markets -41.7 380 — — RBS Securities -40.6 380 — — Scotia Capital -42.0 390 3800 — Societe Generale -39.7 360 — — Standard Chartered -41.5 — — — State Street Global Markets -41.8 376 3756 -225.4 Stone & McCarthy Research -39.7 390 — -230.0 TD Securities -41.5 365 3750 — Thomson Reuters/IFR -41.0 370 3740 -229.0 UBS -42.0 370 — -225.0 University of Maryland -40.9 375 — -235.0 Wells Fargo & Co. -39.4 — — — WestLB AG -41.0 — — — Westpac Banking Co. -41.5 380 — — Wrightson ICAP -41.5 385 3750 — ==============================================================
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