Lately, just about all of the news on initial unemployment claims has been good, and the new figures out this morning were unexpectedly encouraging.
The number of people who applied for new regular state unemployment-insurance benefits fell 12,000 to 334,000 in the week ended June 8, reaching the lowest level since early May, pointing to a slower pace of layoffs, according to data released Thursday by the U.S. Department of Labor. Economists polled by MarketWatch had expected a seasonally adjusted initial claims figure of 350,000, compared with 346,000 in the prior week.
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 23 of the last 26 weeks, and below 350,000 in 7 of the last 10 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.