There was some modest progress on the labor front last week, as the number of new jobless claims filed fell 16,000 to 453,000, the U.S. Labor Department announced Thursday -- returning to the same level as at the start of the year.
A Bloomberg survey had expected initial jobless claims from the week ending Sept. 25 to total 459,000. The previous week's total was revised up 4,000 to 469,000.
In addition, the four-week moving average of initial claims declined another 6,250 to 458,000. Economists emphasize this more-telling average, as it smooths out anomalies due to holidays, strikes, and weather-related layoffs.
New jobless claims need to drop below 400,000 during the next two quarters to give economists and investors confidence that commercial activity is increasing at a pace that will prompt companies to curtail layoffs and resume hiring.
Continuing claims plunged another 83,000 to 4.46 million -- the lowest level since December 2008.
SignificantProgress in Past Year
A year ago, initial jobless claims totaled 546,000, the four-week moving average was at 546,750, and continuing claims totaled 6.01 million.
States also reported 3.97 million people claiming Emergency Unemployment Compensation (EUC) benefits for the week ending Sept. 11, 2010, the latest week for which data is available, a decrease of 256,536 from the prior week. A year ago, there were 3.31 million claiming EUC benefits.
The highest insured unemployment rates for the week ending Sept. 18, the latest week for which data is available, were in Puerto Rico, 6.4%; New Jersey, 4.3%; Oregon, 4.2%; Pennsylvania, 4.2%, California, 4.1%, and Nevada, 4.1%.
The jobless claims report released today represents another qualified "ray of light" for the economy. Although some of the drop in continuing claims reflects benefits that expired, it also represents jobs found. Further, after a rise that was boosted by seasonal, summer layoffs, initial jobless claims are now trending in the right direction -- down -- it's just that they're not trending down that fast. In short, layoffs appear to be subsiding.
The key task for Washington now is to implement policies that will promote job growth -- that is, ones that help convince business executives that the economic recovery will endure -- giving corporate decision makers the confidence to increase production to meet that higher demand.