Initial jobless claims fell to 368,000 in the last week. This is the lowest level in nearly three years and demonstrates that the sluggish employment market is slowly improving. Yesterday, the private payroll company ADP said that the private sector had added 217,000 jobs in February. These two data points are the last ones before the jobs numbers are released tomorrow at 830ET.
Looking at the initial claims numbers, just three weeks ago, both seasonally-adjusted and unadjusted 4-week average claims were about 60,000 lower than at this time last year. Seasonally-adjusted average claims of 416,000 were also about 60,000 lower than just six months ago. Now, seasonally-adjusted average claims at 388,500 are below 400,000 for the first time since July 2008. The fall from just six months ago is now 100,000 and 80,000 from year-ago levels.
My take: this is the best weekly claims report we have seen in quite some time – and not just because of the one-week fall in claims. The trend is clearly down and we have now broken into levels suggestive of a more robust employment environment. The data are showing a decrease in layoffs. What is now needed to aid a sustained recovery is an indication that hiring will start to take off.