The Labor Department said on Thursday that U.S. employers likely added 345,000 more jobs in the 12 months through March than previously estimated. According to it the gain in employment opportunities would be entirely due to a shift in how the government measures payrolls. The latest report from the Labor Department has sent positive signals for the Fed and traders as well.
Reportedly, the number of Americans filing new claims for jobless benefits has fallen too. In the last week it fell to a near six-year low which according to experts is a promising sign for the labor market. Despite positive employment data, the U.S. government left its estimate for economic growth in the second quarter unchanged.
The unemployment figure is a preliminary estimate and subject to a final assessment which will be made when the government revises payroll employment figures which is expected to be released in a report to be published in February next year when the government compares its non-farm payrolls data which collects from monthly surveys of a sample of employers in the country.
The Labor Department of the U.S. also stated that initial claims for state unemployment benefits dropped 5,000 to a seasonally adjusted 305,000. Such an adjustment has been made possible by an update in government computer systems in California and Nevada that threw claims data into confusion earlier this month.
According to an analyst working on the Labor Department data the updates then created a backlog in unprocessed claims which led to a distorted reality and generated panic. However, now the four-week average of new claims has fallen 7,000 to 308,000, the lowest level since June 2007.
Gradual Improvement in Employment
The employment report from the Labor Department is known for their comprehensive monthly check-up for the American labor market and depending upon the indications, markets react. This is important to understand that these reports tell how many jobs are created and where. The data also tell about earnings, hours worked, the number, age and education of those seeking employment, etc.
However, according to analysts, there are only two indicators that consistently attract widespread attention i.e. net monthly job creation and the unemployment rate. Whereas net monthly job creation stands at 169,000 in August, the unemployment rate is at 7.3% for the same month. The current unemployment rate is the lowest since December 2008.
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