WASHINGTON (AP) - Applications for U.S. unemployment benefits rose by 18,000 last week to a seasonally adjusted 354,000. Despite the gain, the level remains consistent with moderate job growth.
The Labor Department said Thursday that the less volatile four-week average increased by 2,500 to 348,250.
Applications are a proxy for layoffs. Since January, they have fallen 6 percent. That suggests companies are cutting fewer jobs.
At the same time, hiring has been steady, despite an increase in taxes on Jan. 1 and steep federal spending cuts that began in March. Solid consumer spending and a rebound in housing have helped the economy weather the fiscal drag.
Employers added 175,000 jobs in May, nearly matching the average monthly gain for the past year.
The unemployment rate ticked up to 7.6 percent from 7.5 percent, but for a good reason: More Americans were confident they could find work and began searching for a job.
The Federal Reserve on Wednesday offered a brighter outlook for the job market and economy. Chairman Ben Bernanke said the Fed is likely to reduce its bond purchases later this year and end them in the middle of next year if the economy continues to strengthen.
The Fed expects the unemployment rate will fall to between 6.5 percent and 6.8 percent by the end of 2014. That's lower than their March forecast of 6.7 percent to 7 percent.