Sept. 16 (Bloomberg) -- The number of U.S. workers filing new claims for unemployment benefits rose less than forecast last week to a level that economists said is consistent with job growth.

Claims rose by 16,000 to 333,000, the Labor Department said in Washington. In the prior week, initial applications plunged to a two-month low because of a decline in the number of Floridians filing in the aftermath of Hurricane Charley. So far this year, initial filings have averaged almost 344,000, down from 402,000 in 2003.

``This is completely consistent with what we've expected at this stage of the economic recovery,'' Timothy Rogers, chief economist at Briefing.com in Boston, said before the report. ``That is, layoffs have died off and demand for labor certainly has increased.''

The numbers reinforce expectations that the economy is pulling out of the mid-year lull, helped by gains in factory production and consumer spending. Increased employment will help take the place of tax breaks and mortgage refinancing as sources of income to sustain the recovery.

Brad Anderson, chief executive of Best Buy Co., said yesterday he expects that job growth will contribute to improved sales in the Christmas shopping season. The Richfield, Minnesota, company is the world's largest retailer of electronic goods.

``There is much reason for optimism,'' Anderson said on a conference call. ``Unemployment rates currently are lower than they were a year ago and consumer confidence levels are substantially improved.''

`No Apparent Effect'

The median forecast of 39 economists surveyed by Bloomberg News called for an increase to 340,000 from the 319,000 initially reported for the prior week. The four-week moving average, a less- volatile number, held at 338,000 last week.

A Labor Department official said Hurricane Charley and Hurricane Frances ``had no apparent effect'' on this week's statistics.

The number of people continuing to collect state jobless benefits fell to 2.882 million in the week that ended Sept. 4 from 2.885 million the week before. The four-week moving average of continuing claims fell to 2.883 million from 2.886 million.

The insured unemployment rate, which tends to move with the jobless rate, held at 2.3 percent. Twenty-six states and territories reported a decrease in claims and 26 had an increase in the week that ended Sept. 4.

Florida

Claims in Florida during that week fell by 4,005 and 1,716 of those were a result of Hurricane Charley. A Labor Department official said last week fewer claims were filed because hurricane- related applications subsided.

Figures on continuing claims and the insured rate are reported on a one-week lag to first-time filings.

Jobless claims this month may be difficult to interpret because of the effects of Hurricanes Charley and Frances, which caused billions of dollars of damage in Florida. Charley hit the state on Aug. 13 and Frances struck on Sept. 4.

Hurricanes can boost unemployment claims temporarily because businesses unable to reopen sometimes fire staff. Jobs may then be added during the rebuilding effort and as companies reopen.

Labor Market

Initial claims in Florida rose by 5,800 in the week that ended Aug. 28, and the Labor Department attributed 4,600 of those to Charley.

``You've got all sorts of anomalies going on,'' that make the recent data hard to read, Steven Ricchiuto, chief economist at ABN Amro Inc. in New York, said before the report.

Surveys indicate that the labor market is continuing to improve. The Federal Reserve Bank of New York's index of manufacturing employment in the region rose to 21.3 this month, the highest level in four months, as factories added workers to meet demand.

Manpower Inc., the world's second-largest provider of temporary help, after Switzerland's Adecco SA, found in a survey of employers that 28 percent planned to add workers from October through December, compared with 22 percent in last year's fourth quarter. A poll by Careerbuilder.com found 49 percent of hiring managers plan to increase payrolls in the final three months this year.

August Employment

Jobless claims in the range of 300,000 to 350,000 typically correspond with accelerated hiring in the U.S., economists including Kevin Harris at Informa Global Markets U.S. say.

The U.S. added 144,000 jobs in August, the most since May and the first time job growth accelerated in five months. Sandra Pianalto, president of the Federal Reserve Bank of Cleveland, last week characterized the news of additional jobs in August as ``mildly encouraging, because it broke the pattern of meager employment growth.''

The U.S. has added an average of 8,000 jobs a month in its current expansion, which started in late 2001. By comparison, 197,000 jobs a month were created from March 1991 to March 2001, during the record economic expansion.

Home Depot Inc., the world's largest chain of home- improvement stores, plans to hire 25,000 people this year, Chief Executive Robert Nardelli said in an interview Friday.

Caterpillar

Caterpillar Inc. has added ``several thousand people'' in the U.S. over the last six to eight months, Chief Executive James Owens said last week in an interview. The Peoria, Illinois, company, the world's largest maker of earthmoving equipment, has had a ``very smart increase'' in sales worldwide and a lot of its products are made domestically, he said.

Democratic Presidential candidate John Kerry, a four-term U.S. senator from Massachusetts, yesterday said President George W. Bush's administration has created ``more excuses than jobs.'' Bush spokesman Scott McClellan pointed to 1.7 million jobs created in the past year and a drop in the national unemployment rate to 5.4 percent as evidence that Bush's tax cuts are working.

To contact the reporter on this story: Courtney Schlisserman in Washington cschlisserma@bloomberg.net

Last Updated: September 16, 2004 08:30 EDT