08.05.14 |
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Decrease in Unemployment Claims May Signal Job Market Recovery

ReductionAccording to a report by Reuters, unemployment benefits claims as of mid-July 2014 have fallen to their lowest level in nearly 8 1/2 years, which may mean that the labor market is beginning to recover.

Contrary to economic forecasts, the 284,000 claims filed the week of July 19 declined by 19,000 from the previous week, hitting the lowest point since February 2006, according to the U.S. Department of Labor. (The 284,000 figure has been seasonally adjusted to account for regularly occurring fluctuations in claims resulting from factors such as weather, major holidays, school openings/closing or similar events.) From March-July 2014, labor growth has surpassed 200,000 jobs each month. July’s labor growth numbers are consistent with the payroll reading for July.

These weekly claim reports can be erratic, so the Labor Department believes that the monthly claim average is a better indicator of labor market trends. But even the four-week average is at its lowest level since May 2007.

Economists say that the Federal Reserve will consider the claims data as it plans to decide whether to raise interest rates—many economists predict a rate increase by mid-2015..

While you can’t control job growth or interest rates, your business can manage its unemployment claims process. Even as job growth continues to heat up, it’s important to continue to handle unemployment claims efficiently to help reduce time and costs associated with claims administration, appeals processing and other HCM functions.

 

 



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