The number of Americans seeking unemployment aid plummeted last week to seasonally adjusted 339,000, the lowest level in more than four years. The sharp drop, if sustained, could signal a stronger job market.
The Labor Department said Thursday that weekly applications fell by 30,000 to the fewest since February 2008. The four-week average, a less volatile measure, dropped by 11,500 to 364,000, a six-month low.
The positive figures follow a report last week that said the unemployment rate fell in September to 7.8 percent. It was the first time since January 2009 that the rate dropped below 8 percent.
A Labor Department spokesman cautioned that the weekly unemployment aid applications can bе volatile, particularly at the start of a quarter. A Labor Department economist said that one large state didn't report "additional quarterly figures as expected," according to The Wall Street Journal.
Unemployment benefit applications are a proxy for layoffs. When they consistently drop below 375,000, it suggests that hiring is strong enough to lower the unemployment rate.
Tracking Jobless Claims
New weekly claims; seasonally adjusted, in thousands