Initial unemployment claims have not improved to the levels we saw in the late summer, but latest figures from the Department of Labor nevertheless point in a generally positive direction.
The number of people who applied for new unemployment benefits edged down by 2,000 to 339,000 in the week ended Nov. 9, the Labor Department said Thursday, but the level of claims remained above end-of-summer levels. Five states, including California and Virginia, used estimates because of processing delays caused by the Veteran’s Day holiday. Economists surveyed by MarketWatch expected claims to fall to 335,000 on a seasonally adjusted basis. The average of new claims over the past month, a more reliable gauge than the volatile weekly number, dropped by 5,750 to 344,000.
To reiterate the point I make every Thursday morning, it’s worth remembering that week-to-week results can vary widely, and it’s best not to read too much significance into any one report.
In terms of metrics, when jobless claims fall below the 400,000 threshold, it’s considered evidence of an improving jobs landscape, and when the number drops below 370,000, it suggests jobs are being created rather quickly. At this point, despite the recent spike, we’ve been below 340,000 in 12 of the last 18 weeks.
Above you’ll find the chart showing weekly, initial unemployment claims going back to the beginning of 2007. (Remember, unlike the monthly jobs chart, a lower number is good news.) For context, I’ve added an arrow to show the point at which President Obama’s Recovery Act began spending money.