Slowly but surely, the Labor Department reports on initial unemployment claims have offered encouraging news over the summer, and today’s new data points to the second lowest total in seven years.
The number of people who applied for regular state unemployment-insurance benefits in the week that ended July 12 fell by 3,000 to 302,000 - the lowest level in nine weeks - signaling that employers are still laying off few workers, according to government data released Thursday. Economists surveyed by MarketWatch had expected initial claims of 310,000 in the most recent weekly data.The average of new claims over the past month declined by 3,000 to 309,000 – the lowest level since June 2007, the U.S. Labor Department reported.
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, we’ve been below 330,000 in 16 of the last 19 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.