Unemployment benefit filings drop to nine month low
WASHINGTON (AP) — The number of people applying for unemployment benefits fell last week to the lowest level in nine months, evidence that the job market is improving.
The Labor Department said Thursday that weekly applications dropped by 23,000 to a seasonally adjusted 381,000. That's the lowest number of applications since late February.
The four-week average, a less volatile measure, fell for the ninth time in 11 weeks to 393,250. That's the lowest average since early April. Applications that drop below 375,000 — consistently — tend to correlate with a steady decline in the unemployment rate.
There are some signs that the economy and job market are improving modestly. The unemployment rate fell to 8.6 percent in November, the government said last week, down from 9 percent the previous month. That's the lowest rate in two and a half years.
Still, the unemployment rate dropped last month in part because more people gave up looking for work. Once the unemployed stop looking for jobs and drop out of the work force, they are no longer counted as unemployed.
Employers added a net total of 120,000 jobs last month. The economy has generated 100,000 or more jobs five months in a row — the first time that has happened since April 2006.
The report on hiring gains followed other positive signs. Manufacturing firms are boosting output and retailers reported a strong start to the holiday shopping season. Consumer confidence jumped in November to the highest level since July, and Americans' pay rose in October by the most in seven months.
Many economists expect growth to accelerate in the final three months of the year, to about a 3 percent annual rate. That would be an improvement from 2 percent growth in the July-September period.
But the U.S. economy is vulnerable to shocks from overseas. European leaders are struggling to contain a two-year old debt crisis and the 17 nations that use the euro may already be in recession, economists say. That could slow U.S. exports and cut into overseas profits earned by U.S. multinationals. Most economists are penciling in slower U.S. growth next year, partly because of Europe's slowdown.
Would you like to contribute to this story? Join the discussion.