Weekly U.S. jobless claims drop; productivity revised lower for second quarter

(Reuters) – The number of Americans seeking jobless benefits for the first time fell unexpectedly last week to the lowest since February, pointing to a U.S. job market that remains relatively tight even as other recent data indicate it has begun to soften.

Initial claims for state unemployment benefits fell to 216,000 in the week ended Sept. 2 from a revised 229,000 the week before, the Labor Department said on Thursday. Economists polled by Reuters had forecast new claims would rise to 234,000 in the latest week.

Meanwhile, the rolls of those continuing to receive jobless benefits beyond the first week fell sharply to 1.679 million in the week ended Aug. 26 from a revised 1.719 million a week earlier.

Continued claims, followed by some economists as a proxy for hiring, had climbed notably from last year at this time through early April when they briefly rose above 1.85 million. Since then, however, they have declined and remain low by historical standards.

A separate report from the Labor Department showed worker productivity in the second quarter was not as strong as initially reported.

Nonfarm productivity – measuring hourly output per worker – increased at a 3.5% annualized rate in the period from April through June versus negative 1.2% in the first three months of the year. Second-quarter productivity had initially been estimated at 3.7%, the strongest since the third quarter of 2020.

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