Published January 02, 2014
The number of Americans filing new claims for unemployment benefits fell for a second week last week, suggesting labor market conditions continue to steadily improve.
Initial claims for state unemployment benefits slipped 2,000 to a seasonally adjusted 339,000, the Labor Department said on Thursday. Claims for the prior week were revised to show 3,000 more applications received than previously reported.
The four-week moving average for new claims rose 8,500 to 357,250.
"It's shocking how stable the number is given all the volatility we have this time of the year from the seasonal adjustments and holiday retail hiring. So from that perspective, that's a welcome sign," said Jacob Oubina, senior economist at RBC Capital Markets in New York.
A Labor Department analyst said no states had been estimated. While claims data continue to be plagued by seasonal fluctuations, there has been an acceleration in job growth.
Against the backdrop of a firming jobs market and brightening economic outlook, the Federal Reserve in December announced it would reduce its monthly $85 billion bond buying program by $10 billion starting this month.
The claims report showed the number of people still receiving benefits under regular state programs after an initial week of aid fell 98,000 to 2.83 million in the week ended December 21.
A total 4.46 million people were receiving benefits under all programs in the week ended Dec 14.
But with benefits for more than a million long-term unemployed Americans having expired on December 28, that figure is set to fall sharply in the coming weeks.
The emergency unemployment compensation program was introduced in 2008 during the depths of recession, and had been extended every year since then.
The loss of benefits could spur former recipients to either drop out of the labor force or accept jobs they previously would not have considered.
Some economists estimate this could lower the current unemployment rate of 7.0 percent by as much as half a percentage point.