WASHINGTON – The number of people who filed new claims for unemployment benefits fell in the latest week, reversing a recent run-up that stoked concerns of a weakening jobs market.
Also Thursday, the Commerce Department reported that the U.S. trade deficit dropped sharply in July as exports rose, a positive indicator. Although the economy is still weak and jobs are hard to find, the data are the latest in a string of reports that have eased concerns of a double-dip recession.
New unemployment applications shot as high as 504,000 in mid-August, but this week’s number is more than 10 percent lower at 451,000, according to data from the Labor Department.
One potentially big caveat about the jobs data is distortion caused by the Labor Day holiday. Two large states, California and Virginia, supplied estimates instead of actual data, while the federal government estimated the claims of seven other states.
Yet even with the larger-than-expected drop, claims are no lower than they were at the end of 2009. The number of new filings each week has hovered around 450,000 the entire year.
“Given the weakness in the labor market, we welcome any sign of improvement in the pace of layoffs, but this figure should be taken with a grain of salt,” economist Omair Sharif wrote in a report.
More encouraging: The report that U.S. goods sold abroad in July rose to an almost two-year high. Imports also fell.
The trade gap dropped to $42.8 billion from $49.8, reversing a sharp increase in June, the Commerce Department said. Economists surveyed by MarketWatch forecast the trade deficit to fall slightly to $47.0 billion.
Exports increased 1.8 percent to $153.3 billion – the highest level in one year – while imports declined 2.1 percent to $196.1 billion.
Most of the pullback in the trade deficit stemmed from higher exports of manufactured goods such as aircraft and computers.
The Labor Department reported that the number of workers who continued to receive state unemployment checks fell by 2,000 to 4.48 million in the week ended Aug. 28. The four-week average of continuing claims fell 3,250 to 4.49 million, the lowest level since December 2008.
Altogether, about 9.67 million people were collecting some type of unemployment benefit in the week ended Aug. 21, compared with about 9.73 million in the prior week.
Extended benefits of up to 99 weeks are offered to workers after they use up eligibility for state unemployment compensation. In most states, benefits last for six months.
Though initial claims are almost 20 percent below the prior year’s level, economists have been concerned about persistently high data. Applications for unemployment assistance tend to fall steadily as the economy recovers.
Companies aren’t adding many new workers, however, and the U.S. jobless rate remains stuck near a 27-year high. Last month it edged up to 9.6 percent from 9.5 percent. The rate is 16 percent if people who can only find part-time jobs, or who have given up looking for work, are included.