You can now read 10 articles a month for free. Read as much as you want anywhere and anytime for just 99¢.

Data raise hopes for faster US economic growth

WASHINGTON — Fewer people are losing their jobs. Employers are struggling to squeeze more work from their staffs. The United States is producing so much oil that imports are plunging, narrowing the trade deficit.

A string of data released on Thursday raised hopes for stronger hiring and US growth in coming months. More jobs would spur spending and help energize the economy, which has yet to regain full health nearly four years after the Great Recession ended.

Continue reading below

And an interest rate cut Thursday by the European Central Bank, if it helps bolster the European economy, could contribute to US growth.

The US economic reports came one day before the government will report how many jobs employers added in April. Economists think the gain will exceed the 88,000 jobs added in March, the fewest in nine months.

The government said Thursday that the number of Americans applying for unemployment aid fell last week to a seasonally adjusted 324,000 — the fewest since January 2008. Unemployment applications reflect the pace of layoffs: A steady drop means companies are shedding fewer workers. Eventually, they will need to hire to meet demand or to replace workers.

The four-week average of unemployment applications, which is less volatile than the weekly figure, sank to 342,250, nearly a five-year low.

The figures for unemployment applications “point to potential improvement moving into May,” said Ted Wieseman, executive director of Morgan Stanley Research.

The government also said Thursday that the productivity of US workers barely grew from January through March after shrinking in the last three months of 2012.

Productivity grew at a seasonally adjusted annual rate of 0.7 percent in the January-March quarter. And that was after it shrank in the October-December quarter. For all of 2012, productivity rose a scant 0.7 percent, after an even punier 0.6 percent rise in 2011.

The government said the US trade deficit narrowed in March for a second month, as the daily flow of imported crude oil reached a 17-year low.

A smaller trade gap is good for economic growth because it means America is exporting more while spending less on foreign goods.

The gap shrank 11 percent from February to $38.8 billion. Exports fell 0.9 percent, led by fewer shipments of US machinery, autos, and farm products.

But thanks to reduced US demand for imported oil, imports fell even more — 2.8 percent. Petroleum imports fell 4.4 percent. Crude oil imports averaged 7 million barrels a day, the fewest since March 1996.

The United States is not using less oil. Rather, surging production has reduced the need for imported oil. US output averaged 7.2 million barrels a day for the four weeks that ended March 29, the Energy Department said, the most since 1992.

US refiners have been taking advantage of low US prices for oil and natural gas to produce fuels at much lower costs than foreign competitors can.

Despite some encouragement from Thursday’s figures, the economy is not growing fast enough to reduce high unemployment. The Federal Reserve reiterated Wednesday after a policy meeting that it plans to keep short-term interest rates at record lows at least until unemployment falls from its current 7.6 percent to 6.5 percent .

The Fed also said it will continue to buy $85 billion a month in bonds to keep long-term borrowing costs down and encourage borrowing and spending. And it signaled that it is open to expanding the bond buying.

Some are concerned that higher Social Security taxes and deep government spending cuts that took effect this year might have started to hurt the economy.

The Fed expressed that concern Wednesday after its policy meeting.

“Fiscal policy,” the Fed cautioned, “is restraining economic growth.”

Loading comments...

You have reached the limit of 10 free articles in a month

Stay informed with unlimited access to Boston’s trusted news source.

  • High-quality journalism from the region’s largest newsroom
  • Convenient access across all of your devices
  • Today’s Headlines daily newsletter
  • Subscriber-only access to exclusive offers, events, contests, eBooks, and more
  • Less than 25¢ a week