WASHINGTON – New claims for unemployment benefits fell more than expected last week as layoffs ease and hiring slowly recovers.
The decline brought the four-week average of claims, which smoothes volatility, to its lowest level since September 2008, when the financial crisis intensified. The report is an encouraging sign that the economy is getting closer to generating job gains, economists said.
“We’re on the cusp of a hiring recovery,” said Zach Pandl, an economist at Nomura Securities.
The Labor Department said Thursday that first-time claims for jobless benefits dropped by 14,000 to a seasonally adjusted 442,000. That’s below analysts’ estimates of 450,000, according to Thomson Reuters.
The report contributed to a rise in the stock market. The Dow Jones industrial average rose more than 119 points before paring some of those gains later in the day. Broader indexes also rose.
Initial claims have fallen in three of the past four weeks, wiping out most of the increase that took place in the first two months of this year.
First-time claims were elevated last month by severe snowstorms on the East Coast, which caused backlogs in many state offices that fell behind in processing claims.
Many economists say claims need to fall below roughly 425,000 to signal that the economy will consistently create jobs, though some say it could happen with claims at higher levels.
Analysts forecast the nation will gain more than 150,000 jobs in March. That would be the second time the economy has added jobs since the recession began.