February 9, 2012 in Nation/World

Unemployment aid applications near a 4-year low

Associated Press

WASHINGTON — The number of people seeking unemployment aid neared a four-year low last week, a positive sign that strong hiring could continue in the coming months.

The Labor Department said Thursday that weekly applications for unemployment benefits fell 15,000 to a seasonally adjusted 358,000. That’s the second-lowest level since April 2008.

The four-week average, a less volatile measure, fell to 366,250, the lowest since late April 2008.

“The encouraging U.S. employment news continues,” Jennifer Lee, an economist at BMO Capital Markets, wrote in a note to clients. The “job market started February off on a sturdy footing.”

When applications fall consistently below 375,000, it generally signals that hiring is strong enough to lower the unemployment rate.

Employers added a net gain of 243,000 jobs in January, the biggest gain in nine months. The unemployment rate fell for the fifth straight month to 8.3 percent, the lowest in nearly three years.

From November through January, the economy has added an average of 201,000 net jobs per month.

The increased hiring in part reflects faster economic growth. The economy expanded at an annual rate of 2.8 percent in the final three months of last year — a full percentage point higher than the previous quarter.

Applications are also falling because companies are laying off fewer workers. A separate report from the Labor Department, released earlier this week, showed that job cuts have fallen below pre-recession levels. Layoffs dropped last year to the lowest annual total in the 10 years the government has tracked the data.

With job cuts low, even a modest increase in hiring results in net job gains.

The number of people receiving benefits edged up in the week ending Jan. 21, the latest data available. About 7.6 million people received unemployment aid that week, a slight increase from the previous week. That figure includes about 3.5 million people receiving extended unemployment benefits under an emergency program set up during the recession.

That program is set to expire at the end of this month, unless Congress agrees to extend it through the end of the year. Lawmakers are wrangling over how to pay for an extension of benefits and for an extension of a Social Security tax cut that is also set to expire at the end of this month.

Most economists expect growth will slow a bit in the January-March quarter, because companies won’t need to rebuild their stockpiles of goods as much as they did in the winter.

But some economists are increasingly optimistic that the economy will steadily expand this year, given last month’s unexpectedly large job gains and other positive signs.

U.S. manufacturing activity grew in January at the fastest pace in seven months. Americans are buying more cars and trucks. And consumers stepped up borrowing in November and December by the most in a decade, which could indicate they are growing more confident in the economy.

Still, the job market has a long way to go before it fully recovers from the damage of the Great Recession. Nearly 13 million people remain unemployed, and 8.3 percent unemployment is painfully high.

One reason the unemployment rate has fallen for five straight months is that many people have stopped looking for work. The government only counts people as unemployed if they are actively searching for a job.

17 comments on this story so far. Add yours!

JBlim on February 09 at 6:53 a.m.
Poor Mitt Romney, err . . Rick Santorum. Things just aren’t going as the Republicans hoped and planned for. Now voters will have to choose between the Republicans who destroyed the economy or the Democrats who brought it back to life.
lewis8457 on February 09 at 7:32 a.m.
back to life? not by a long shot, many are living w/o the unemployment because they were dumped off the fund Jan 28th. no more money.
westerly on February 09 at 8:09 a.m.
“The government only counts people as unemployed if they are actively searching for a job”…..there it is..millions more than the report says are out of work. Probably the real percent of people out of a job is 10 percent if you count the millions who quit looking for work and are not counted by the Feds.
drywitt99 on February 09 at 8:21 a.m.
Yeah Lew…..22 monhs of job growth……more manufacturing jobs….Detroit saved….GM #! in the world……
We ain’t there yet……but WE ARE headed in the right direction.
AS OPPOSED TO THE FINAL YEARS OF THE BUSH ADMINISTRATION!!!!
Ashree_Simon on February 09 at 8:23 a.m.
Yes, there are millions of those that have quit looking for work, but you can’t deny that this is a good leading indicator.
drywitt99 on February 09 at 8:32 a.m.
Compare the first 3 years of President Obama’s first term…..
http://www.tradingeconomics.com/chart.png?s=usurtot&d1=20090201&d2=20120131
To the first 3 years of President Reagan’s first term……
http://www.tradingeconomics.com/chart.png?s=usurtot&d1=19810201&d2=19840131
Now tell me again what HISTORIC DISASTER President Obama has been???
liberal_in_right_wing_land on February 09 at 9:52 a.m.
The HISTORIC DISASTER was the village idiot that was president before the community organizer.
Seems many republicans forget WHO put this country into this recession in the first place. Kinda hard to fix 8 years of pure STUPIDITY in three years people.
de3 on February 09 at 9:55 a.m.
Until the ghost town of empty buildings around Spokane starts filling up, the unemployment data doesn’t mean much around here.
JBlim on February 09 at 10:18 a.m.
The economy lost 700,000 jobs the month Obama became president. What a disaster he had to deal with, thanks to the Republican way of doing things.
misjustice on February 09 at 10:26 a.m.
The economy is SLOOOOOOWLY improving; the GOP must hate that! Dang it, they tried to keep it from improving at all and did a darn fiine job, too! But, despite their best efforts, there are small signs of improvement.
oldarmy on February 09 at 12:35 p.m.
….understanding that welfare roles have nearly doubled in very state and this years homeless count is at it’s highest since the Great Depression of 1929. Ya, this is THE BEST NEWS OF 2012!!
Shadedmuse on February 09 at 2:44 p.m.
The ression is over!!!
also the NJ Giants basicly put Obama’s re-election in the banque with their superbowl win.
drywitt99 on February 09 at 2:59 p.m.
Spell check muse…..spell check…..
jddavis on February 09 at 5:08 p.m.
A better use of this ad-hoc data would be an analysis of different state benefit durations without / with extended UI benefit duration considered. Correlate that data with individual state job creation / cuts during various periods during sample period.
Another way to look at job market improvement is looking at the average duration people are on UI during this time period. If the average time is decreasing (not expiring), it would be safe to say the job market is improving.
The SR could improve the story with additional information from the state ESD.
dataxman on February 09 at 5:51 p.m.
drywitt - banque, checque - British spelling. She was trying to show her sophistication…
Seagraf on February 09 at 5:53 p.m.
The improvement, however small, is even more surprising given the strategy of the Repubs to stop every attempt of the Admin to take positive steps to improve the economy. As Senator Demint stated the entire mission of the Repubs was to make Obama a one term President, as opposed to actually working with the Admin to stimulate the economy, improve the job market, etc..
greenlibertarian on February 09 at 9:56 p.m.
drywitt99 on February 09 at 2:59 p.m.
Spell check muse…..spell check…..
Please don’t feed the troll.