Jobless claims hint labor market improving gradually

WASHINGTON, Thu Oct 18, 2012 – The number of Americans filing new claims for jobless benefits spiked last week, reversing a sharp decline in the prior week but still pointing to a labor market that is slowly healing.

Other data on Thursday showed a modest rebound in factory activity in the U.S. mid-Atlantic region.

Initial claims for state unemployment benefits rose 46,000 last week to a seasonally adjusted 388,000, the Labor Department said.

Despite the spike, a four-week moving average that smoothes out weekly volatility was down from a month earlier, suggesting the lackluster job market recovery remains on track.

“Improvement in the labor market will continue to be fitful and slow,” said Joseph Trevisani, a market strategist at Worldwide Markets in Woodcliff Lake, New Jersey.

The economy has recently shown signs of modest strength, with the unemployment rate falling to 7.8 percent in September and retail sales pointing to a pick-up in consumer spending.

A gauge of future economy activity rebounded in September to post its largest gain in seven months, the Conference Board said in a separate report.