The number of Americans filing for unemployment benefits unexpectedly fell last week, pointing to strength in the labor market despite a sharp slowdown in hiring last month. Bobbi Rebell reports.
The jobs picture just got a jolt of good news. Just days after a shockingly weak monthly report that showed a big slowdown in hiring, the latest weekly report showed the number of Americans signing up to get jobless benefits dropped a lot more than expected. Initial claims for state unemployment benefits dropped to a seasonally adjusted 264,000 for the week ended June 4, according to the Labor Department. Wayne Kaufman, chief market analyst at Phoenix Financial Services explains: (SOUNDBITE) WAYNE KAUFMAN, CHIEF MARKET ANALYST, PHOENIX FINANCIAL SERVICES, (ENGLISH) SAYING: "People aren't firing anybody, companies are not firing. That's why jobless claims are at extremely low number. So, I think, it's just stagnant hiring for a while. Hopefully, it'll pick up later in the year." The bigger trend is also good. Claims have now been below the key threshold of 300,000 for 66 straight weeks. That is the longest streak since 1973. And the four-week moving average of claims - which takes out a lot of the weekly volatility - also fell. The latest data is in stark contrast to most recent monthly report, which showed only 38,000 news jobs in May, which put the timing of the next Federal Reserve rate hike into question on new concerns about the labor market.