Jobless claims edge lower

NEW YORK (CNNMoney) -- The number of Americans filing first-time claims for unemployment benefits declined last week, according to a government report, raising optimism that the job market recovery is gaining steam.

There were 388,000 initial jobless claims filed in the week ended March 26, the Labor Department said Thursday. That was down 6,000 from the previous week's revised 394,000.

Economists surveyed by Briefing.com had expected initial claims to total 383,000 in the latest report.

The Labor Department said the latest report reflects the annual revision to the weekly unemployment claims for seasonal factors. Last week's total, for example, was revised up by 12,000.

"The revised data show a slightly less steep drop in claims over the past few months but the key point here is that the trend is still clearly downwards," said Ian Shepherdson, an economist at High Frequency Economics.

The 4-week moving average of initial claims, which smoothes out volatility in the measure, was 394,250. That was up 3,250 from the previous week's revised average of 391,000.

In addition to the decline in initial claims, the number of Americans filing for ongoing claims for unemployment benefits dropped 51,000 to 3,714,000 in the week ended March 19, the most recent week available.

The 4-week moving average of continuing claims was 3,765,250, down 32,750 from the week before.

On Wednesday, payroll processor ADP reported that private sector employment rose by 201,000 in March, while an outplacement firm said planned layoffs declined in the month.

Thursday's initial claims report comes one day before the government's monthly payrolls report, one of the most closely watched economic indicators on Wall Street.

A CNNMoney survey of 18 economists forecast an 180,000 jump in payrolls. They also expect the unemployment rate to hold steady at 8.9%.

Shepherdson said he expects the decline in initial claims to continue as access to credit becomes easier for businesses.

"The drop in claims has already been reflected in a clear acceleration in private payrolls in recent months, and we think there is more to come," he said. "The labor market recovery is gathering momentum."