Evidence of an improving job market came in last week, with the number of Americans claiming new state unemployment falling by some 5k to a seasonally adjusted 348k, the lowest since Feb 2008 (according to the Labor Department data released yesterday).
The previous week beat out the Reuters poll of economists slightly, with the upwardly revised 353k falling just short of projections by a thousand. This means that the better benchmark, the four-week moving average for new claims, declined, showing an improving labor market as claims fell 1,250 to 355k.
Covering the survey week for March nonfarm payrolls, the claims data shows a drop of 5k between February and March, further indicating that the overall job market may be on the mend and that the economy experienced another month of recognizable job gains.
Senior Economist over at Pittsburgh’s PNC Financial Services, Gus Faucher, called it good news for the March payroll report and a positive sign for the health of the nation’s labor market. Faucher underscored that net job growth of 200k means another solid month and while the labor market may have dug itself into a pretty deep hole, this data offers tangible evidence that the market is starting to dig itself out.
With employers tacking on another 227k jobs in February (bringing the total for the last three months to 734k), unemployment is at just 8.3 percent, down 0.8 percent from August. Further positive indicators from the Federal Reserve, projecting a gradual decline in the jobless rate, simply adds to the emerging profile.
With the USD extending gains against the Euro and US Treasury debt prices falling in response to the good news, US stock index futures held onto losses amid lagging concerns about the growth of the Chinese economy. A Labor Department official indicated that the data was normal and that the only estimates were Alaska and Minnesota, chomping at the bit ahead of next week’s introduction of new seasonal factors for 2012, in addition to sweeping revisions of 2007-2011 claims data.
Regular state benefits to people after the first week of aid dropped sharply by 9k to 3.35M for the week ended March 10, the lowest level since August 2008, further indicating that the rebound time for unemployed is improving. Long-term unemployment however remains a daunting concern with just under half (about 43 percent) of the 12.8M figure in February having been out of work for more than six months.
Emergency unemployment benefits output dropped as well to 2.85M, down 24.3k for the week ending March 13, the most recent data set that is available, offering a good volatility indicator for improving overall job market stability.
Finally, elsewhere among the data burst, we see overall totals of 7.28M under all programs claiming unemployment benefits for the period, down 142.5k from the previous week, giving a nice clear picture of spring shoots.
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