First-time unemployment claims fall

By Blake Ellis, staff reporter


NEW YORK (CNNMoney) -- The number of Americans filing for first-time unemployment benefits eased more than expected last week, setting the stage for the government's closely-watched jobs report due Friday.

There were 415,000 initial jobless claims filed in the week ended Jan. 29, the Labor Department said Thursday. That was down 42,000 from the week before, and better than the 425,000 claims economists surveyed by Briefing.com had expected.

Continuing claims -- which include people filing for the second week of benefits or more -- fell to 3,925,000 in the week ended Jan. 22, a decline of 84,000 from the week before.

While the latest report shows an improvement, jobless claim figures have been jumping around recently, so economists haven't been reading too much into the weekly figures, said Robert Dye, a senior economist at PNC Financial Services.

"They've been in a saw-tooth pattern for the last six weeks," said Dye, adding that seasonal factors like the timing of holidays and severe snowstorms have sent the numbers on a roller coaster ride.

"You have to take this labor indicator along with other broad indicators we have like ADP and the payroll numbers coming out tomorrow -- which, taken as a complete basket, all point to improving labor market conditions," he added.

The 4-week moving average of initial claims -- a measurement used to smooth out week-to-week volatility -- is viewed as a more accurate representation of job market conditions. While that number rose by 1,000 to 430,500, Dye said this is still well below the high levels seen in 2010.

"I think we're on an improving trend here and in the next couple of weeks we're likely to see even more improvement, indicating that labor conditions are starting to turn the corner and that we should see more hiring in 2011," he said.

The report comes a day before the government releases its widely anticipated monthly jobs report. Economists surveyed by CNNMoney expect the report to show that the economy added 149,000 jobs in December and that the unemployment rate rose to 9.5%. To top of page

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