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First-Time Jobless Filings Decline to Five-Year Low : Employment: The drop is about four times what had been expected. California is among the leaders in new claims.

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From Associated Press

The number of Americans filing for first-time unemployment benefits plunged 39,000 last week to the lowest level in nearly five years, the government said Thursday.

In a report that shows how volatile the job market is, the Labor Department said initial claims declined to a seasonally adjusted 291,000 in the week ended Dec. 25, down from a revised 330,000 for the previous week. That was the lowest level since Feb. 4, 1989, when initial claims totaled 286,000.

Economists had predicted a decline in part because of the Christmas holiday. (Initial claims usually decline during holiday weeks.) But the drop of 39,000 was nearly four times what they had expected.

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The huge decrease was fueled in part by fewer layoffs in construction, manufacturing and the textile industry.

The four-week moving average of initial jobless claims declined 7,750 from the previous week to a seasonally adjusted 321,000, the lowest level since Sept. 9, 1989. Economists prefer to use that figure as a measure of hiring trends because it is much less volatile than the weekly number, which has swung up and down over the last few months.

The four-week average has fluctuated in a relatively narrow range between 330,000 and 350,000 since mid-August.

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Economists have consistently said the job market is improving, led by gains in hiring among smaller companies.

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