Initial jobless claims fall

WASHINGTON — Employers appear to be holding on to workers at a higher rate than expected, as first-time claims for jobless benefits fell more than forecast last week, according to a Labor Department report released today.
Initial jobless claims fell by 12,000 to 308,000 in the week ended July 7, more than double the median forecast by economists surveyed by Bloomberg News, and the lowest level in almost two months.
“Growth in employment during the second half of the year will be similar to what we saw in the first half,” Christopher Low, chief economist at FTN Financial in New York told Bloomberg. “We have modest employment growth, and it’s enough to support wages.”
Strength in the job market, with rising payrolls and income, will help sustain consumer spending even as fuel costs rise and home values decline, economists said, although they cautioned that interpreting June and July data is difficult because of temporary layoffs of auto workers for plant upgrades.
A separate government report indicated that the U.S. trade deficit widened in May, as the cost of imported oil overtook record exports. The Commerce Department said that the gap in goods and services grew 2.3 percent to $60 billion from $58.7 billion in April.