Lowest Number of Unemployment Applicants in Over Two Years
The number of people applying for unemployment benefits fell sharply last week, a positive sign that the job market could be slowly improving.
The Labor Department says initial unemployment applications across the nation dropped by 34,000 to 388,000, the lowest number in over two years.
With the Wyoming Department of Employment, Tom Gallagher is the manager of Research & Planning of the Unemployment Tax Division.
“And their indication is that, that’s the lowest level in the last two and a half years and they are treating that as a positive sign in the economy and the labor market.”
The level of applications has either fallen or remained unchanged in five of the past six weeks.
“Well, it’s a good statistic, it’s interpretation is a little problematic.”
While lower unemployment applicants may seem good at first, Gallagher reminds us that there are two sides to the story.
“There is some research that we’ve done that raises the question of whether or not people have been able to find work of sufficient duration and of sufficient earnings to re-qualify for claimant status. It may be that these initial claims are down because people nationally haven’t been able to obtain a job of sufficient duration to re-qualify for initial benefits.”
The level of applications can be particularly volatile during the holidays. But a Labor Department analyst said there were no unusual factors affecting the report.
“At this time of year, (we) run between one thousand and fifteen hundred claims during 2009. We’re below that now, we’re down between nine-hundred and a thousand per week. It’s come down by about a third.”
Unemployment applications below 425,000 signal modest job growth. But economists say applications need to fall to 375,000 or below to indicate a significant decline in unemployment.