Initial claims drop in latest week
Government report shows 550,000 first time claims for jobless benefits were filed last week, fewer than forecast.
NEW YORK (CNNMoney.com) -- The number of Americans filing first time claims for unemployment benefits fell last week, while the number of people requesting ongoing benefits rose, the government said Thursday.
There were 550,000 initial jobless claims filed in the week ended Aug. 1, down 38,000 from an upwardly-revised 588,000 the previous week, according to the Labor Department's weekly report.
The total was smaller than the 580,000 new claims economists surveyed by Briefing.com had forecast.
The number of initial jobless claims filed in recent weeks had been distorted by seasonal adjustments related to plant closures in the auto industry, which occurred earlier this year. But a Labor Department official said this seasonal volatility had "run its course."
The report suggests that the pace of the decline in the labor market is slowing. But many economists warn that it's too soon to say the nation's job woes are over.
"The numbers are volatile even when the trend is clear," said Ian Shepherdson, chief U.S. economist at High Frequency Economics, in a research report. "We need to see several more weeks at this level to confirm a real shift."
Still, last week's tally "certainly looks good" compared to previous weeks, Shepherdson said.
The four-week moving average of initial claims, which smoothes out volatility in the measure, was 555,250. That's a decrease of 4,750 from the previous week's revised average of 560,000. The average has declined for six weeks in a row.
The government also said 6,310,000 people filed continuing claims in the week ended July 25, the most recent data available. That's up 69,000 from the preceding week's revised 6,241,000 claims.
The four-week moving average of continuing claims fell 148,500 to 6,278,750.
Thursday's report came a day before the government's closely watched monthly jobs report.
The Labor Department report is expected to show that the economy shed 328,000 jobs in July, less than the 467,000 reported for June. The unemployment rate is predicted to rise to 9.6% from 9.5%. 
