WASHINGTON -- The number of people filing new claims for unemployment benefits in the U.S. fell in the latest week to its lowest level in nearly 18 months, a sign the labor market may be turning a corner.
Initial claims for unemployment benefits fell by 22,000 to a seasonally adjusted 432,000 in the week ended Dec. 26, the lowest level since July 19, 2008. The four-week average of new claims, which aims to smooth volatility in the data, dropped by 5,500 to 460,250. That marked the 17th consecutive drop in the figure and the lowest level since Sept. 20, 2008.
The Labor Department said in its weekly report, released Thursday, that 4.98 million people had been collecting jobless benefits for more than a week in the week ended Dec. 19, a decline of 57,000.
The trend in jobless claims is sometimes hard to read during the holidays. "While an underlying downtrend is clearly in place, it is being exaggerated now by seasonal adjustment difficulties, which will continue over the very near term," economist Joshua Shapiro of MFR Inc., New York, said in a note to clients.
Recent data signal that the U.S. recovery from the worst recession in decades is taking hold. Robust retail sales and improving consumer confidence have raised expectations for strong economic growth in the fourth quarter. That has prompted some optimism that employers may soon resume hiring after two years of cutting payrolls.
The Labor Department is to release its snapshot of December's labor market on Friday. Economists at Wrightson ICAP predicted in a note Wednesday that the jobless rate, last reported at 10% for November, may have inched lower to 9.9% in December.
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