You know the news of initial unemployment claims is pretty good when the number inches higher, but is still near a five-year low.
The number of people applying for new unemployment benefits edged up by 2,000 to 336,000 in the week ended March 16 but remained near a five-year low, the U.S. Labor Department said Thursday. Economists surveyed by MarketWatch expected claims to rise to a seasonally adjusted 340,000. The average of new claims over the past month, which irons out weekly volatility, dropped by 7,500 to 339,750, the lowest level since February 2008.
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. We’ve been below the 370,000 threshold 13 of the last 15 weeks, and we’ve also been below 350,000 in five 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.