Thursday, October 20, 2011

Jobless Claims Straddle Key Level; Big Upturn Still Elusive

Applications for unemployment benefits have fallen to a six-month low, according to a four-week averaged calculated by the government.

Some economists said the steady decline signals fewer layoffs and possibly stronger job growth in the months ahead. But they cautioned that employers are not yet hiring at healthy levels.

Weekly applications dropped by 6,000 to a seasonally adjusted 403,000, the Labor Department said Thursday. The four-week average fell for the fourth straight week to 403,000. A month ago it was 422,250.

"This decline in initial claims signals the potential for an improvement in the pace of job creation in October relative to recent months," said John Ryding, an economist with RDQ Economics. "However, we are still waiting for that decisive move in claims below the 400,000 mark to send a stronger signal that payroll growth is running at a pace that will begin to make sustained inroads into unemployment."

Many economists say applications need to fall consistently below 375,000 to signal sustainable job growth. They haven't been below that level since February. more