It's about time we got some good news on the jobs front. Not just one, but two, reports this week give us hope that we've finally turned the corner.
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Today we learned the number of people filing for unemployment last week plunged to a nearly three- year low. Applications fell by 20, 000 to 368, 000, and economists had predicted a much higher number.
It's the third decline in the past four weeks. Applications are now at their lowest level since May of 2008. They peaked during the recession at 651,000 in March of 2009.
When that number is below 375,000 consistently, it tends to signal steady declines in the unemployment rate.
Yesterday the ADP report showed a gain of 217,000 jobs in the private sector in February. And who's doing the hiring? Medium and small businesses.
Out of the 217,000 job gains, 204,000 went to the smaller companies. This brighter outlook from these two reports is all well and good, but tomorrow morning we hear from the labor department— the big number that everyone looks at.
And guess what - analysts are predicting strong gains.
Employers are predicted to have added a net 185,000 jobs in February. That would mark an improvement from an anemic 36,000 jobs back in January.
But at the same time, economists think the unemployment rate will edge up to 9.1%.
That's a double-edged sword.
That would mean the jobless rate will have been above 9% going on nearly two years. The last great recession saw unemployment this high for only about a year and a half.
But unemployment rates often tick up when out-of-work people who haven't been looking for jobs start to look. Either way - we mustn't get blinded by the shininess of these latest jobs reports.
Yes, we're moving in a positive direction... but we still have a long way to go.
It's time for businesses sitting on hoards of cash to start hiring, and for government to get out of the way so that can happen.