New jobless claims tumble to 2-year low
WASHINGTON – The number of new claims for US unemployment insurance tumbled last week to a two-year low, according to official data Thursday, offering hope for the troubled labor market.
The Labor Department said initial jobless claims fell to a seasonally adjusted 383,000 in the week ending February 5, down nearly nine percent from the prior week.
The department revised upward the previous week’s reading to 419,000, from an initial estimate of 415,000.
The 383,000 figure was the lowest since early July 2008, data showed.
The four-week moving average, a measurement to smooth out week-to-week volatility, also showed a positive trend for jobs: it fell to 415,000 from last week’s 431,500.
The sharp decline in new claims surprised most analysts, who had forecast a drop to 410,000, and lent strength to other recent data on payrolls and job creation that suggest a turnaround in the US job market.
Last week the government reported that the unemployment rate fell to 9.0 percent from 9.4 percent, based both on the trend and on data adjustments.
At the same time, the number for newly created non-farm jobs was very low at 36,000 for the previous week. But that was blamed on harsh winter weather that shut businesses temporarily and prevented some data collection as well.
The severe storms of late January and early February continued to skew the numbers, a Labor Department official said Thursday.
“We are still unwinding a bit of the weather effect,” he told reporters.
Despite signs that the US economic recovery is gaining pace, top government officials have warned that the slow pace of new job creation represents a continuing, crucial weakness.
The US economic recovery has “strengthened in recent months” and now looks self-sustaining, but is still not enough to significantly improve the job market, Federal Reserve Chairman Ben Bernanke told a congressional panel Thursday.
“Until we see a sustained period of stronger job creation, we cannot consider the recovery to be truly established,” he said.