Jan 8, 2015 2 min read

WASHINGTON – Fewer Americans applied for unemployment benefits last week, a sign employers expect ongoing economic growth and the need to hold onto workers.

The Labor Department said Thursday applications for unemployment benefits fell 4,000 last week to a seasonally adjusted 294,000.

The four-week average, a less volatile measure, slipped 250 to 290,500. That average plunged 16 percent in the past 12 months, as averages stayed at historically low sub-300,000 levels since September.

Applications are a proxy for layoffs. As fewer workers are being let go, employers are bringing on new employees to meet customer demand.

In the monthly jobs report being released today, employers are expected to have added 243,000 jobs in December, according to FactSet. That would follow job gains of 321,000 in November and put total job growth in 2014 at just shy of 3 million, the best performance since 1999.

The unemployment rate slid to 5.8 percent from 6.7 percent at the start of 2014.

In a separate report Wednesday, payroll processor ADP said private companies added 241,000 jobs in December, up from 227,000 in November. It was a good indicator hiring should be solid in today’s U.S. report, which showed job gains in excess of 200,000 for the past 10 months.

Still, wage growth lagged hiring. Average wages increased only 2.1 percent in the past 12 months. That means incomes are only barely outpacing inflation. Core consumer prices – which excludes volatile energy and food costs – rose 1.7 percent over the past 12 months.