WASHINGTON – 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.
At the same time, nearly 25,000 Nevadans are being notified that their jobless benefits will be cut off after this week unless Congress acts by Tuesday to extend federal emergency unemployment compensation.
State officials say another 1,000 people each week stand to lose their jobless benefits if the program implemented in 2008 at the height of the recession is not extended.
Still, state officials are urging people to continue filing their weekly claims so they can be paid if lawmakers do extend the program, as they’ve done in the past.
Nevada offers 26 weeks of unemployment compensation. With heavy job losses during the recession, the federal government extended the period to 99 weeks in states with record high unemployment.
The program has been scaled back to 73 weeks as the economy has improved.
For the national figures, the 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 dip in applications. But they emphasized 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 .
But unemployment remains high and companies are reluctant to increase 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.