The number of Americans making new claims for unemployment benefits is dropping, pushing the four-week average for jobless assistance to a five-year low and signaling that the U.S. labor market might be stabilizing.
The U.S. government said Thursday that 340,000 unemployed workers made new claims for financial aid last week, a drop of 7,000 from the week before.
That pushed the four-week average down to 348,750 - the lowest total since March 2008, in the early stages of the country's worst economic downturn since the Great Depression of the 1930s. Fewer claims for benefits usually mean that employers are curtailing worker layoffs.
James Glassman, the senior economist at one of the country's biggest banks, JPMorgan Chase, said the U.S. economy, the world's largest, is advancing.
"There’s a momentum building in the U.S. economy. We stumble, we get back on our feet. We’ve done this many times. This is our history,” said Glassman.
He said the American economy is following a familiar pattern in its recovery from the recession in 2008 and 2009.
“The first thing that happens when we get back on our feet is the stock market, first of all businesses re-establish profitability, then the stock market responds, and then it takes a long time to get the job market back to a fully employed state. But you know we’ve recovered in this country, we’ve recovered 63 percent of the job losses from the recession. So it tells you that it’s happening, but it’s happened slowly, the job market still slowly, it’s the last one to heal. But it’s pretty evident that it’s taking place,” he said.
Despite the improving jobless claims numbers, the country's unemployment rate has remained stubbornly high - 7.9 percent in January, well above the historical norm of about 5 percent. More than 12 million workers remain unemployed.
On Friday, the government is set to disclose the jobless rate and job growth for February, both seen as key barometers for the state of the American economy.