Unemployment claims at 3-month low
The number of people filing first-time unemployment claims falls by 34,000. Continuing claims hit 14th straight record high.
NEW YORK (CNNMoney.com) -- The number of people filing initial claims for unemployment benefits fell last week, to their lowest level in more than 3 months, according to a government report released Thursday, suggesting the pace of decline in the job market is slowing.
But the number of people filing claims on an ongoing basis rose to a record high for the 14th straight week as employers remain reluctant to hire in the weak economy.
In the week ended May 2, a total of 601,000 people filed initial jobless claims, down 34,000 from an upwardly revised 635,000 in the previous week, said the Labor Department. It was the lowest level since the 590,000 claims filed in the week ended Jan. 24.
The total was smaller than expected. Economists had forecast 635,000 new claims, according to a consensus survey by Briefing.com.
The 4-week moving average of initial claims, which smooths out volatility in the measure, fell 14,750 to 623,500.
"We are seeing some improvement in the labor market," said Mark Vitner, an economist at Wachovia Economics Group. And Thursday's report suggests "that the most recent peak in layoffs is behind us," he added.
But initial claims are expected to rebound in the coming weeks as now-bankrupt automaker Chrysler LLC shuts down plants and workers begin requesting benefits, Vitner said.
While the broader economy has show some signs of stabilization, analysts expect the job market remain weak even after economic conditions rebound.
The Labor Department is expected to report Friday that the nation's unemployment rate rose to 8.9% in April from 8.5%, according to a survey of economists by Briefing.com. However, the number of jobs lost in April is expected to decrease 43,000 from the previous month to 620,000.
Continuing claims: The number of people continuing to file jobless claims rose to a fresh all-time high, indicating that more people are struggling to reenter the workforce.
"There's no evidence that hiring has picked up and continuing claims increased further," Vitner said.
In the week ended April 25, the most recent data available, 6,351,000 continuing claims were filed. That's a record high and an increase of 56,000 from the previous week.
The 4-week moving average for continuing claims was was 6,207,250, an increase of 125,250 from the prior week.
Signs of life: Thursday's report comes one day after two private sector reports showed the job market is improving slightly.
Automatic Data Processing, a payroll processing firm, said private-sector employment decreased by 491,000 in April, a 31% improvement from the revised 708,000 drop in March. Economists had expected a loss of 643,000 jobs.
Separately, outplacement firm Challenger, Gray & Christmas Inc. reported that the number of announced layoffs fell for the third consecutive month in April, dropping 12% to 132,590. 
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