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US unemployment aid applications hit lowest level in 4 years, evidence of stronger job market
WASHINGTON (AP) ' The number of people seeking U.S. unemployment benefits dropped last week to the lowest level in four years, adding to evidence that the job market is strengthening.
The Labor Department said Thursday that weekly unemployment benefit applications fell 5,000 to a seasonally adjusted 359,000. That's the smallest number of applicants since April 2008. The four-week average, a less volatile measure, declined to 365,000.
The department also made its annual revisions to the past five years of unemployment benefit data. The revisions increased the number of unemployment benefit applicants in recent months. But the downward trend remains intact.
When unemployment benefit applications drop consistently below 375,000, it usually signals that hiring is strong enough to lower the unemployment rate. The decline has coincided with the best three months of hiring in two years.
From December through February, employers added an average of 245,000 jobs per month. That has pushed down the unemployment rate to 8.3 percent, the lowest in three years.
Companies are hiring more because the economy is picking up. The economy grew at an annual rate of 3 percent in the final three months of last year. That was better than the 1.8 percent rate in the previous quarter.
There are other signs the economy is steadily recovering. Companies ordered more durable goods last month. That's a sign rising factory output will likely boost economic growth.
Consumers remained confident in March, even as gas prices jumped. That suggests greater hiring is offsetting the harm to confidence from higher gas prices.
Even the battered housing market is showing signs of improving. January and February comprised the best winter for sales of previously occupied homes in five years, according to the National Association of Realtors.
One concern is that rising gas prices will force consumers to cut back on discretionary spending. That could weigh on economic growth and slow hiring. The Federal Reserve says it expects oil and gas prices to temporarily boost inflation but predicts that longer-term inflation should remain stable.
The job market still has a ways to go to fully recover from the Great Recession. More than 12.8 million people remain unemployed and the economy still has 5 million fewer jobs than before the downturn.
But the more robust job market has caused some so-called "discouraged workers" to start looking again. The work force rose by nearly a half-million in February.