U.S. Trade Deficit Declines to Lowest Level in Four Years

Gains in energy production and stronger sales of American-made airplanes, autos and machinery lifted exports to a high.

The trade gap dropped 12.9 percent in November, to $34.3 billion, the Commerce Department said on Tuesday. That is the lowest monthly trade deficit since October 2009.

Exports rose 0.9 percent, to a record $194.9 billion. The gain was aided by a 5.6 percent increase in petroleum exports.

Imports dropped 1.4 percent, to $229.1 billion. A decrease in demand for foreign oil offset a record level of imported autos.

A smaller trade deficit can lift economic growth. It typically shows that American companies are earning more from sales overseas, while consumers in the United States are buying fewer products from foreign companies.

Economists raised their growth forecasts for the October-December quarter after seeing the November trade report.

Jennifer Lee, senior economist at BMO Capital Markets, noted that the trade gap declined in both October and November. She is forecasting growth at an annual rate of 2.4 percent. But after the trade report she said growth could end up stronger.

Paul Ashworth, chief North American economist at Capital Economics, said growth could be 3 percent or higher.

Through 11 months of 2013, the trade deficit is 12.3 percent lower than the same period in 2012. Exports have strengthened, while imports are slightly lower.

New Claims by Jobless Are Lowest Since 2007

WASHINGTON — A measure of Americans who applied for unemployment benefits over the last month has fallen to its lowest level in almost six years, signaling fewer layoffs.

The Labor Department said on Thursday that the average number of people who applied for benefits over the last four weeks dropped by 6,250, to 335,500. That is the lowest level since November 2007, the month before the Great Recession began.

The four-week average smooths week-to-week fluctuations.

Weekly applications for unemployment aid increased by 5,000 last week to a seasonally adjusted 333,000. But that is up only slightly from the previous week’s five-and-a-half-year low.

The decrease in the four-week average points to a positive trend in recent months. Applications, which are a proxy for layoffs, have fallen more than 10 percent since the start of the year. That has helped drive net job gains this year, which are the number of people hired minus the number who lose or quit their jobs.

Employers added 162,000 jobs last month, the smallest monthly gain since March. And most of the job growth came in lower-paying industries or part-time work. Since January, the economy has added an average of 192,000 jobs a month. But the pace has slowed to 175,000 in the last three months.

When employers are cutting few workers, as they are now, it does not take many hires to create a high net gain.

The job market is improving, largely because layoffs have fallen to pre-recession levels. But while employers are no longer cutting jobs, many remain reluctant to hire in the face of tax increases, federal spending cuts and slower global growth.

Jobless Rate Falls to 7.8%, Lowest Since January 2009

While employers added only a modest 114,000 jobs last month, the jobless rate declined to 7.8 percent from 8.1 percent, even though more people entered the labor force.

Adding to the positive news, job gains were revised upward by 40,000 for July (to 181,000) and by 46,000 for August (to 142,000), which had been considered a disappointing month, casting a slightly rosier hue on the summer slowdown.

The private sector, which has been adding jobs since March 2010, grew by 104,000 workers in September. Governments, where cuts have been a drag on the recovery, added 10,000 jobs.

Manufacturing, one of the bright spots that Mr. Obama has showcased throughout the re-election campaign, fell 16,000 jobs after losing  a revised 22,000  in August, and construction jobs grew by 5,000. The number of temporary jobs, usually considered a harbinger of future growth, fell 2,000.

Coming a month before the presidential election, the jobs report offered ammunition for both sides as the candidates vie to convince voters that each is better equipped to steer the economy.

Mr. Obama can point to the 24th straight month of overall job growth after a severe financial crisis and a drop below the stubborn 8 percent jobless rate that has dogged his presidency. Republicans can — and did on Friday — continue to criticize the slow pace of improvement.

Mitt Romney, the Republican presidential challenger, took particular issue with any positive interpretation of the report.

“This is not what a real recovery looks like,” he said in a statement. “We created fewer jobs in September than in August, and fewer jobs in August than in July, and we’ve lost over 600,000 manufacturing jobs since President Obama took office.”

Representative Kevin Brady, a Republican from Texas and vice chairman of the joint economic committee, said the drop in the unemployment rate “was driven primarily by an increase of 582,000 in the number of workers employed involuntarily in part-time jobs. These workers need and want full-time jobs.”

“If not for all the people who have simply dropped out of the labor force,” Mr. Romney said in his statement, “the real unemployment rate would be closer to 11 percent.”

Representative Eric Cantor of Virginia, the majority leader, conceded that numbers were an improvement but added, “it simply isn’t good enough.” A jobless rate of 7.8 percent “should not be cause for celebration.”

Senate Majority Leader Harry Reid, Democrat from Nevada, countered that “with unemployment dropping below 8 percent to the lowest level in four years, our economy is on the right track.”

Consumers and businesses, too, seem to have divergent views of the economic situation. Consumers have shown increasing confidence as stocks rise and home prices stabilize.

Business leaders have been hanging back, though, more focused on global economic slowing and domestic concerns. They say they are uncertain what the election will mean for the business climate and are waiting in part for a resolution of the so-called fiscal cliff, a host of tax increases and budget cuts that will be triggered at the end of the year if Congress fails to act.

Harry Kazazian, the chief executive officer of Exxel Outdoors, a maker of camping equipment in Alabama, said the election, the fiscal cliff and rapidly shifting regulations had put him in a cautious mood.

With sales on the rise, Exxel has restarted a capital investment plan that it suspended three years ago, but is doing so slowly. “We’re moving forward, but we’re doing it in steps rather than being much more aggressive and putting ourselves out there,” Mr. Kazazian said. “I wouldn’t be surprised if things start turning the other way, meaning down.”

But at a Walmart in Atlanta, shoppers were loosening the reins a bit, buying what they described as small indulgences like scented candle oil and seasonal beer.

Linda Avery, 50, a food service manager, said her income had not changed but her daughter had moved out of the house, reducing her food and utility expenses.

John H. Cushman Jr. contributed reporting from Washington.