First-time Unemployment Claims Sink to Early-Recession Levels

(MCT)—In another sign that the job market is gaining momentum, the number of workers filing for unemployment benefits fell further last week—down to levels last seen in the early months of the recession.

The Labor Department said Thursday that first-time jobless claims dropped by 15,000 to 358,000 last week, although week-to-week changes can be volatile.

The average for the past four weeks, a more reliable measure, dropped to 366,250—the lowest four-week average since April 2008.

Initial jobless claims averaged 418,000 in the same four-week period last year. The decline reflects the slowdown in layoffs at companies as the economy has improved and employers have shown a greater willingness to hold on to their existing workers.

Earlier this week, the Labor Department reported an increase in job openings. And last Friday, in the single most important monthly gauge of the economy, the government said employers across a broad spectrum of industries added a net total of 243,000 jobs in January, the most in nine months.

All these data indicate that the labor market is healing, but most analysts remain cautious. Unemployment claims fell last winter as well, and job growth spiked in the early months last year only to fizzle by summer as shocks from the global economy and domestic politics undercut confidence.

The continuing drop in jobless claims—considered a signal of future economic trends—shows that the problem with today’s job market isn’t layoffs but rather the modest and unsteady hiring at companies. Business confidence appears to be rising, and if the economy continues to perk up, employers are likely to step up their hiring.

The economy has a long way to go to make up for the jobs lost in the recession, and the latest data showed nearly 13 million people were officially unemployed in January. As of Jan. 21, the government said Thursday, about 7.7 million people were receiving state and federal unemployment benefits, down from 9.4 million a year earlier.