US jobless claims tumble as private hiring holds steady

[WASHINGTON] New claims for US unemployment insurance benefits tumbled last week to near a three-month low as hiring in the private sector held steady in June, data released Thursday showed.

On the eve of the June US employment report, the Labour Department said that initial jobless claims, a sign of the level of layoffs, fell by 16,000 to 254,000 in the week ending July 2.

The four-week moving average of new claims fell by 2,500 to 264,750, down nearly 14,000 from a year ago. Initial claims have held below 300,000 for 70 straight weeks, the longest streak since 1973.

"In general, claims have remained encouraging, consistent with a strong gain in payrolls in tomorrow's report for June after the disappointing May data," said Ian Shepherdson of Pantheon Macroeconomics.

Separately, payroll firm ADP reported the US private sector added 172,000 jobs in June, slightly higher than the 168,000 positions created in May.

ADP said that its track of monthly job creation had slightly dropped since the start of 2016 amid lackluster global growth, low commodity prices and a strong dollar.

"Job growth revived last month from its spring slump. Job growth remains healthy except in the energy and trade-sensitive manufacturing sectors," said Mark Zandi, chief economist at Moody's Analytics which helps prepare the ADP report.

Markets awaited Friday's official June jobs report covering the public and private sectors. It is expected to show job growth rebounded to 175,000 nonfarm payrolls from a paltry 38,000 in May. The unemployment rate is forecast to rise a tenth point to 4.8 per cent.

AFP