New claims for unemployment benefits dropped to a 3 year low last week according to a government report today. This could mean the jobs market is recovering faster than expected. The Labor Department said claims for state unemployment benefits dropped 19,000 to 366,000.
The prior week’s claims data was revised up to 385,000 from the initially reported 381,000. It will be interesting to see if this fresh data will also be revised up and if so, how much. Most economists had expected a forecast of 390,000 new jobless claims. This drop pushes jobless claims closer to 350,000, which many believe is a sign of labor market strength.
The positive news from the jobs market shows that the U.S. economy is beginning to turn around. Earlier this week, The Federal Reserve acknowledged the improving jobs market but said unemployment remains high.
Economists are keeping a very close eye on the debt crisis in Europe as any further problems could affect the U.S. economy.
The four-week moving average of claims, a more accurate measure of labor market trends, fell to a three year low of 387,750. 3.6 million people are receiving benefits under state programs after one week of aid.
Overall, the jobs market is beginning to look better. There are still millions of people unemployed, but any drop in jobless claims is good news for them.