Requests for U.S. unemployment benefits drop 19,000 to 366,000 By Jeffry Bartash, MarketWatch WASHINGTON (MarketWatch) – The number of Americans who filed requests for jobless benefits fell sharply last week to the lowest level since May 2008, indicating that a fragile U.S. labor market continues to heal. First-time applications for unemployment compensation declined by 19,000 to a seasonally adjusted 366,000, putting claims at the lowest level since the middle of the 2007-2009 recession. Claims from two weeks ago were revised up to 385,000 from 381,000. Economists surveyed by MarketWatch had projected that claims would rise to a seasonally adjusted 390,000 in the week ended Dec. 10. Jobless claims have declined gradually from a 2011 peak of 478,000 in late April. And claims have fallen below 400,000 - a level historically associated with an improving labor market - in five of the past six weeks. The average of new claims over the past four weeks, meanwhile, fell by 6,500 to 387,750 – the lowest level since July 2008. The monthly average is seen as a more accurate gauge of labor trends because it reduces volatility in the week-to-week data. Yet claims reflects only the number of people who lose jobs, not those who finds one, so it’s an imprecise gauge of hiring trends. What’s more, economists caution that the end-of-the-year holiday period tends to skew claims because of seasonal factors that are difficult to account for. Still, the steady decline in claims is likely to soothe the concerns of investors and the Federal Reserve, which is still considering additional moves to boost the economy. More accurate data on job creation, mainly the monthly employment report, show that companies are adding workers at a modest rate. The economy has gained an average of 143,000 jobs over the past three months after hiring nearly ground to a halt in early summer. At that rate of hiring, the economy is able to absorb the natural increase in the labor force as former students and immigrants seek jobs and mothers reenter the workplace. Yet the U.S. will need to gain an average of about 250,000 jobs each month over several years to slash the unemployment rate to precession levels, economists estimate. The official jobless rate stood at 8.6% in November, but it’s closer to 16% when including people who can only find part-time work as well as discouraged job seekers who’ve recently stopped looking. The Labor Department said continuing claims, or the number of people who continue to receive benefits, rose by 4,000 to a seasonally adjusted 3.60 million in the week ended Dec. 3. Continuing claims are reported with a one-week lag. About 7.45 million people received some kind of state or federal benefit in the week ended Nov. 26, up 874,670 from the prior week. Total claims are reported with a two-week lag. The federal government offers extended compensation to millions of Americans whose state benefits have already expired. Extra benefits were first authorized after the 2007 recession struck. Jeffry Bartash is a reporter for MarketWatch in Washington.

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