Unemployment Filings Are Near a 2-Year Low

The number of Americans filing first-time claims for jobless insurance last week hit the lowest level since President Bush took office in January 2001, raising hopes that employment growth will accelerate.

The Labor Department on Wednesday said 339,000 idled workers filed for unemployment benefits at state offices throughout the country in the week ended Dec. 27.

That figure is 15,000 fewer than the previous week and much lower than Wall Street economists had expected.

“At 339,000 new claims, you’re well within the range that you’d expect a growing economy, even in a briskly growing economy,” said Patrick Fearon, an economist for A.G. Edwards and Sons.

“Seasonality around the holidays can have an impact, but when claims are down that low and when you had a pretty good downtrend, I think you can be pretty confident that at the very least the labor market is strengthening,” Fearon said.

The more stable four-week moving average of claims, which smooths out week-to-week fluctuations, decreased last week by 6,500 to 355,750, the lowest level since Feb. 10, 2001.

New claims have fallen by 36,000 over the last three weeks. Although the weekly data give a more timely look at labor market conditions, the comprehensive payrolls report for December due out Jan. 9 will garner closer attention from the Federal Reserve as it weighs its next interest rate move.

The Federal Open Market Committee, the policymaking arm of the U.S. central bank, next meets Jan. 27-28.

Analysts estimated that the economy generated 125,000 new jobs in December, accelerating from the increase of 57,000 reported for November.

Overall claims, which have been inching lower since October, have fallen for three straight weeks. This could keep a lid on a 5.9% U.S. jobless rate for December.

However, the number of people continuing to claim a week of benefits rose by 81,000 to 3.32 million, suggesting that people are still having a tough time finding work.