Initial jobless claims have now fallen about 11% since early summer, and economists and business executives hope the summer's jobless claims surge above 510,000 reflected primarily typical seasonal layoffs, not renewed weakness in the economy.
A Bloomberg survey had expected initial jobless claims to total 455,000.
In addition, the four-week moving average plummeted 13,500 to 464,750. Economists emphasize the more-telling four-week average, as it smooths-out anomalies due to holidays, strikes, and weather-related layoffs.
During an adequate expansion, jobless claims are capable of falling much lower. During the 2002 to 2007 expansion, they fell below 370,000 for more than two years. And during the "Roaring 90s," jobless claims basically remained below 350,000 for more than five years.
Labor Market: Minor Progress In Past Year
A year ago, initial jobless claims totaled 547,000, the four-week moving average was at 559,500, and continuing claims totaled 6.11 million.
States also reported 4.11 million persons claiming Emergency Unemployment Compensation (EUC) benefits for the week ending Aug. 28, the latest week for which data is available, a decrease of 402,116 from the prior week. A year ago, there were 3.18 million persons claiming EUC benefits.
Another sign that labor markets continue to heal after the summer doldrums concerns claims totals among states that experienced increases in initial jobless claims.
For the week ending Sept. 4, the latest week for which data is available, the states with the highest claims increases had low totals: Pennsylvania, 1,442; Washington state 1,190; and Texas, 809. That's something one sees as layoffs subside and hiring picks up. Moreover, if that trend continues in the months ahead, it will confirm a labor market that's healing.