It was a little discouraging to see initial unemployment claims climb above 300,000 three of the last five weeks, but today's news helps set minds at ease.
The number of people who applied for unemployment benefits sank by 21,000 to 283,000 in the seven days from Feb. 8 to Feb. 14, signaling that layoffs remain low and the pace of the hiring in the U.S. is still strong. Economists polled by MarketWatch had expected claims to fall to a seasonally adjusted 290,000 from an unrevised 304,000 in the first week of February.The average of new claims over the past month, meanwhile, declined by 6,500 to 283,250, the Labor Department said Thursday. That's the lowest level since late October and the second lowest since the recovery began five and a half years ago.
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. At this point, we’ve been below 300,000 in 19 of the last 23 weeks. On the other hand, we’ve been above 300,000 three of the last six 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.