Fewer Americans are filing applications for unemployment benefits, with the number of jobless claims dropping last week – an indicator that the labor-market is improving.
The drop in claims reveals that the recent dip in manufacturing, housing starts and retail sales didn’t affect the job market as much as expected.
According to a Labor Department report on Thursday, in the seven days ended March 21 the number of jobless claims dropped by 9,000 down to 282,000 – the lowest level since mid-February.
The four-week moving average of jobless claims, a less volatile measure, dropped by 7,750 to 297,000 last week.
The number of claims were lower than what economists had expected, of 290,000, according to a Bloomberg survey.
Jobless claims are a proxy for layoffs
Claims have been below 300,000 for three straight weeks now, which analysts say coincides with more hiring.
The steady drop in unemployment is expected to continue if claims are sustained at last week’s levels.
Stephen Stanley, chief economist at Amherst Pierpont Securities in Stamford, Conn. said in a research note:
“Underlying labor market conditions have been relatively stable for a number of months and are extremely robust, as, historically, any reading below 300,000 is rare,”
First quarter economic growth
Last month the unemployment rate dropped to a 6 year low of 5.5 percent in February, with the economy adding 295,000 jobs.
The Atlanta Federal Reserve expects Q1 growth to be at an annualized rate of 0.2 percent, but some analysts, such as those at private firm Macroeconomic Advisers (predicting growth of 1.4 percent), are bit more optimistic about how the US economy will perform this quarter.
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