WASHINGTON – U.S. unemployment benefit applications rose by 18,000 last week to a seasonally adjusted 354,000. Despite the gain, the level remains consistent with moderate job growth.
The Labor Department said Thursday that the less volatile four-week average increased by 2,500 to 348,250.
Applications are a proxy for layoffs. Since January, they have fallen 6 percent. That suggests companies are cutting fewer jobs.
At the same time, hiring has been steady, despite an increase in taxes on Jan. 1 and steep federal spending cuts that began in March. Solid consumer spending and a rebound in housing have helped the economy weather the fiscal drag.
Employers added 175,000 jobs in May, nearly matching the average monthly gain for the past year. The unemployment rate ticked up to 7.6 percent from 7.5 percent, but for a good reason: More Americans were confident they could find work and began searching for a job.
The Federal Reserve on Wednesday offered a brighter outlook for both the job market and the economy. And Chairman Ben Bernanke said the Fed is likely to slow its bond-buying program later this year and end it next year if the economy continues to strengthen.
Fed officials upgraded their economic projections. They now expect the unemployment rate to fall to between 6.5 percent and 6.8 percent by the end of 2014. That's lower than their March forecast of 6.7 percent to 7 percent.
There have been other signs the job market is strengthening. The Labor Department said last week that more Americans quit their jobs in April compared with March. That points to confidence in the job market, since most workers don't quit until they have another job or are sure they can find one. More quits also opens up jobs for other workers, or the unemployed, to take.
Also last week, a survey of chief executives at the largest U.S. companies showed that they are more optimistic about sales in the next six months and plan to add more workers.