The number of people seeking unemployment aid last week fell to its lowest level since mid-May, suggesting layoffs are easing and hiring could pick up.
The Labor Department says weekly unemployment benefit applications dropped by 14,000 to a seasonally adjusted 374,000, the fewest since the week of May 19. The four-week average, which smooths out weekly fluctuations, dipped by 1,500 to 385,750.
Weekly benefit applications serve as a measure of the pace of layoffs. When applications consistently fall below 375,000, it generally suggests hiring is strong enough to reduce the unemployment rate.
Applications declined steadily over the winter, coinciding with a burst of hiring. But applications rose in the spring and were stuck near 390,000 for five weeks. Hiring, meanwhile, slowed sharply in April and May.