The less volatile four-week average for claims rose to 263,250 last week, the highest level in a year. Applications from Texas, recovering from Hurricane Harvey, totaled 51,988 last week, down by 11,800 from the previous week, but still far above the normal range of around 12,000 applications filed weekly in Texas.
The number of Americans receiving unemployment benefits dropped by 7,000 to 1.94 million, 9.1 percent lower than a year ago. THE TAKEAWAY: Economists closely watch unemployment claims, which serve as a proxy for layoffs. Even with recent increases, claims remain at levels signifying a strong labor market.
Natural disasters can frequently cause spikes in benefit claims. Superstorm Sandy in 2012 drove the last huge increase in applications. The Labor Department said that claims in Texas and Louisiana had been impacted last week by Harvey, while benefit applications in Puerto Rico were affected by Hurricane Irma. Claims in Florida dipped slightly last week, but Irma did not hit the U.S. mainland until Sunday.
Even with the disruptions from the storm, new weekly claims so far have remained below 300,000 for the longest stretch going back to 1970. Economic growth accelerated in the spring with the economy, as measured by the gross domestic product, expanding at an annual rate of 3 percent, more than double the 1.2 percent GDP growth rate in the first quarter.
Hiring slowed in August, when employers added 150,000 jobs, below last year's average monthly gain but still enough to lower the unemployment rate over time. Unemployment in August stood at 4.4 percent, near a 16-year low.