The Labour Department said claims data for some states, including California, Massachusetts, North Carolina and Virginia, had been estimated. The labour market is near full employment, with the jobless rate at a 17-year low of 4.1 percent. "Higher jobless claims are not signalling a slowdown in the economy, that's for sure," said Chris Rupkey, chief economist at MUFG in New York. "The labour market looks strong and the outlook for 2018 is even better."
The ADP Research Institute said private payrolls increased by 250,000 jobs in December, the biggest gain since March, and well above economists' expectations for a rise of 190,000. The ADP National Employment Report is jointly developed with Moody's Analytics. The gains in employment were broad-based last month. Manufacturing payrolls rose by 9,000 and employment in the construction sector increased by 16,000. The service-providing industries added another 222,000 jobs last month.
The ADP report was released ahead of the Labour Department's more comprehensive employment report on Friday. According to a Reuters survey of economists, nonfarm payrolls probably rose by 190,000 jobs in December after a gain of 228,000 in November. The tightening labor market encouraged the Fed to raise interest rates three times last year despite inflation persistently undershooting the US central bank's 2 percent target.
Minutes of the Fed's December 12-13 policy meeting published on Wednesday showed officials upbeat about the economy and labour market prospects. They viewed economic activity as "rising at a solid rate," and the labour market as continuing to strengthen. In a separate report on Thursday, global outplacement consultancy Challenger, Gray & Christmas said US-based employers announced 32,423 job cuts in December, a 7.4 percent decrease from November. That brought the total number of layoffs in 2017 to 418,770, the fewest since 1990. Employers announced 526,915 job cuts in 2016.
In a third report, the Labour Department said initial claims for state unemployment benefits increased 3,000 to a seasonally adjusted 250,000 for the week ended December 30. Last week marked the 148th straight week that claims remained below the 300,000 threshold, which is associated with a strong labor market. That is the longest such stretch since 1970, when the labor market was much smaller.
The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, increased by 3,500 to 241,750 last week.