Last week, according to the U.S. Department of Labor, the number of unemployment applications filed dropped by 6,000. That is consistent with other recent reports that indicate a modest growth in the nation’s hiring.
Unemployment applications level off
The number of weekly applications were uneven for the month of July. That, most analysts agree, had to do with the difficulty of predicting summer slow-downs in the auto industry. Generally, the summer months are slow for automakers. Many have stayed atypically busy, however, in efforts to keep up with consumer demands.
Now, the Labor Department says, those figures are leveling out. Thursday, Aug. 9, it announced a seasonally-adjusted 361,000 applications for the week ended Aug. 4. Even by the less-volatile four-week average of 368,250, that is still well below 375,00.
Most analysts agree that the number of applications must fall below 375,000 to suggest strong enough hiring to lower the unemployment rate.
Hiring uptick may continue
July’s federal job numbers showed that 163,000 jobs were added to the nation’s workforce. That is a large improvement from the discouraging numbers early in the year.
The job market has faced a mid-year slump, which seems to be leveling out. Paul Dales, an economist with Capital Economics, said that the lower number of applications may indicate a continued strength in hiring:
“The pick-up in jobs growth in July may therefore be sustained in August.”
Sill, the numbers show only modest gains. In spite of them, the unemployment rate grew from 8.2 percent to 8.3 percent.
The amount of jobs added to the economy has to be greater and for a longer period of time for the unemployment rate to fall again. The rate of overall economic growth in the second quarter was 1.5 percent, as compared to the 2 percent seen in the year’s first quarter. The last quarter of 2011 showed growth of 4.1 percent, however much of that may have been buoyed by seasonal spending and a mild winter.
While the Labor Department reported more job openings in June than in the previous four years, nearly 13 million people were still out of work in June, with an average of 3.4 applicants vying for each position.
Normally it takes about three months for new job postings to be filled. Those increased job openings may be a sign of hiring growth in the months to come. Also, worker productivity increased by a meager 1.6 percent for the second quarter, which means that employers will need to add jobs if demand picks up.