U.S. Jobless Aid Applications Fall to 5-Year Low

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Job applicationsBy CHRISTOPHER S. RUGABER, AP Economics Writer

WASHINGTON (AP) - The average number of people seeking U.S. unemployment benefits over the past month fell to the lowest level since March 2008, a sign that the job market is healing.

The Labor Department said Thursday that weekly applications dropped 12,000 to a seasonally adjusted 350,000 in the week ended Dec. 22. The four-week average, a less volatile measure, fell to a nearly five-year low of 356,750.

Still, the Christmas holiday may have distorted the figures. A department spokesman said many state unemployment offices were closed Monday and Tuesday and could not provide exact data. That forced the government to rely on estimates. Normally, the government might estimate application data for one or two states. Last week, it had to use estimates for 19.

The estimates are usually fairly accurate, the spokesman said. Even so, the government will likely revise the figures by more than normal next week.

Weekly applications are a proxy for layoffs. They have mostly fluctuated this year between 360,000 and 390,000. At the same time, employers have added an average of 151,000 jobs a month in the first 11 months of 2012. That's just enough to slowly reduce the unemployment rate.

Economists were mildly encouraged by the decline in applications. But they emphasized that the figures are volatile around the holidays. They were also distorted until recent weeks by Superstorm Sandy.

Many expect next week's jobs report to show that employers added about 150,000 jobs in December.

The decline in unemployment benefit applications suggests companies are not yet slashing jobs because of concerns over the "fiscal cliff." That's the name for sharp tax increases and spending cuts that are scheduled to take effect next week unless the Obama administration and Congress can reach a deal before then.

Still, unemployment remains high and companies are reluctant to ramp up hiring. The unemployment rate fell to 7.7 percent in November from 7.9 percent in October mostly because many of the unemployed stopped looking for jobs. The government counts people as unemployed only if they are actively searching for work.

Negotiations between President Barack Obama and House Republican leaders on a package to avoid the fiscal cliff stalemated last week. Obama and congressional lawmakers return to Washington Thursday with just days to go before the deadline.

The total number of people receiving benefits rose 73,000 to 5.48 million in the week ended Dec. 8, the latest data available.

That includes about 2.1 million people who have been out of work for at least six months and are receiving extended benefits paid for by the federal government. The program is ending at the end of the year. That means those recipients will receive their final checks next week, unless an extension is granted.

Obama wants an extension included in the budget deal. Republicans have yet to agree to that.

There are signs the economy is improving. The once-battered housing market is recovering, which should lead to more construction jobs in the coming months. Companies ordered more long-lasting manufactured goods in November, a sign they are investing more in equipment and software. And Americans spent more in November. Consumer spending drives nearly 70 percent of economic growth.

While a short fall over the cliff won't push the economy into recession, most economists expect some tax increases to take effect next year. That could slow growth.

Consumers are starting to worry about higher taxes. A measure of consumer confidence fell to a five-month low this month, a survey released Friday found. And reports show the holiday shopping season was the weakest since 2008, when the country was in a deep recession.

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8 Comments

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nthereoff

Congress can't agree on tax increase for most Americans. But have no problem voting for a raise for them selfs. I guess hard work pays off??

December 30 2012 at 7:54 AM Report abuse rate up rate down Reply
akrzyston

If only this would also help raise incomes!

December 28 2012 at 12:07 PM Report abuse rate up rate down Reply
COMMON SENSE

Fraud figures. Everyone knows businesses hire in the Christmas Season. Now look at next year?? The Obamacrats in their tax and spend wanting more blank checks will kill any chance of new employment. Obama belives Big government can keep america working. 50% pay no Taxes. the rest of us cannot support the other 50%. DO THE MATH!!! Only free enterprise can do this. we must let buisinesses make mony in order to grow and hire more people.

You know you live in a Country run by idiots if….Hard work and success are rewarded with higher taxes and government intrusion, while slothful, lazy behavior is rewarded with EBT cards, Welfare checks, subsidized housing, and free cell phones.

December 28 2012 at 11:26 AM Report abuse rate up rate down Reply
bbhsudduth

Facts? You ask? Where Government is concerned the only fact is that Liars Figure and Figures Lie. Where in that do you see any mention of Facts? And even if there was something factual, would anyone be able to tell what it was? If facts are what you want, you had better invent some or your own as there has not been any Facts in Washington for a very long time. However, we do have plenty of Snakes in expensive suits and two legged land Sharks so that is at least one Fact upon which you can rely.

December 27 2012 at 7:05 PM Report abuse +1 rate up rate down Reply
bbhsudduth

Could it be that more and more people realize that making this application and dealing with the government's clap trap, is a bigger waste of their time and effort than just making due on their own? I would not be so quick to credit "economic improvement" as the reason for the propaganda numbers. Government is starving to report that after all the money they have pissed-away on bailouts, big banks and collapsing companies, China, rebel Muslim insurgents and Principalities, that we are starting to see some benefit from it. After all the BS, they are close to making the paper dollar as useful as toilet paper but they have failed that too but not for lack of trying and perhaps not for long. Go Obamma! Go leadership! Jump over that "Fiscal Cliff" I can hardly wait . Go ahead, make an even bigger name for yourselves. You will go down in and with Infamy! At least you are taking the lead down the toilet. So much for your leadership.

December 27 2012 at 6:53 PM Report abuse rate up rate down Reply
linmarco

It's either true or it isn't. If someone has facts to the contrary then post them.

December 27 2012 at 4:12 PM Report abuse rate up rate down Reply
thedtecter

"The average number of people seeking U.S. unemployment benefits over the past month fell to the lowest level since March 2008, a sign that the job market is healing."

LOL, I think the AOL/Huff Post writers are having a contest to see who can pen the funniest joke before 2012 ends!

December 27 2012 at 2:44 PM Report abuse +1 rate up rate down Reply
mrspelosi

What a bunch of baloney darlings.

December 27 2012 at 2:41 PM Report abuse +3 rate up rate down Reply
pgile

OK, even though these are first-time filings for unemployment benefits, don't let that stop anyone from posting that the decline was due to people's long-term benefits expiring and/or their dropping out of the labor force.

December 27 2012 at 1:36 PM Report abuse +2 rate up rate down Reply