WASHINGTON (AP) — Fewer people probably applied for unemployment benefits last week, a sign that companies are slowing the pace of layoffs as the economy improves.
Economists forecast that applications for unemployment benefits fell by 4,000 to a seasonally adjusted 378,000 in the week that ended April 9. That would be the fourth drop in five weeks.
Applications near 375,000 are consistent with a sustained increase in hiring. Applications peaked during the recession at 659,000.
The number of people seeking unemployment benefits has fallen steadily for several months. The four-week average of applications, a less volatile measure, has dropped by nearly 30,000, or about 7 percent, in the past eight weeks. At the same time, companies are hiring more.
The unemployment rate fell to a two-year low of 8.8 percent in March and has fallen a full percentage point since November, the sharpest four-month drop since 1983.
Stepped-up hiring is the main reason for the decline in the unemployment rate. But a more sobering factor is that the number of people who are either working or seeking a job is surprisingly low for this stage of the recovery. People without jobs who aren't looking for one aren't counted as unemployed. Once they start looking again, they're classified as unemployed, and the unemployment rate can go back up. That can happen even if the economy is adding jobs.
Applications for unemployment benefits could rise in the coming weeks due to disruptions from the earthquake and tsunami in Japan. Toyota said last week that it will probably be forced to temporarily shut down all of its North American factories. Nissan and Ford Motor Co. have said several North American plants would be closed for some of April.
Businesses in February posted the largest number of job openings in more than two years, evidence that hiring is picking up. Employers advertised 3.1 million available jobs that month, the most since September 2008, the government reported Wednesday.
Google Inc, electronics store hhgregg Inc. and Kohl's Corp. are among the companies that have announced plans in recent weeks to increase hiring.