US jobless claims see a decline, layoff fears ease

WASHINGTON: Fewer Americans filed first-time claims for unemployment insurance last week and total benefit rolls shrank, indicating companies are nearing the end of staffing cuts as the economy recovers. Initial jobless applications declined to 470,000 in the week ended Jan. 23, higher than anticipated, from 478,000 the prior week, Labor Department figures showed today in Washington. The total number of people receiving unemployment insurance dropped to the lowest level in a year and those receiving extended benefits also fell.

Companies may want to see accelerating sales before taking on more staff after making the deepest payroll cuts in the post- World War II era.

Federal Reserve policy makers yesterday said that while consumer spending is expanding, it is partly being "constrained by a weak labor market."

"We're still improving at a very moderate, very slow pace," said Julia Coronado, a senior economist at BNP Paribas SA in New York. "The economy is having difficulty making the transition from the ending of firings to the beginning of hiring."