One day before the February non-farms payroll report is released, the jobs market got a bit of good news with a fewer number of people than projected filing for first-time jobless benefits last week, according to a weekly report from Washington, D.C.
The Labor Department reported that initial jobless claims, a proxy of weekly firings, dropped by 26,000 to 323,000 in the week ended Mar. 1, marking the lowest level in 13 weeks. Meanwhile, the week prior figure was revised upward from 348,000 to 349,000. Economists were expecting a drop last week, but only to 337,000 new claims.
The four-week moving average, a less volatile proxy of the labor market because it flattens weekly fluctuations, declined by 2,000 to 338,500. Economists generally view claims beneath 350,000 as reflective of modest jobs growth. Slowly, but surely, the overall trend is still holding a path showing a strengthening job market.
Bitter cold and snowy conditions in January and February have raised some questions about the root cause of the nation’s economy slowing at the start of 2014. New Fed Chairwoman Janet Yellen last month told the Senate Banking Committee that the U.S.’s central bank will be thoroughly evaluating economic data to try and discern how much was negatively impacted by the inclement weather so far this year and how much is truly softness in the economy. Claims falling last week will likely be viewed as employers hanging on to staffers as spring approaches, perhaps setting the scene for increased hiring as the economy accelerates as the weather breaks.
Continuing claims, the count of people that are already collecting benefits under state programs, dropped by 8,000 to 2.907 million in the week ended February 22. Continuing claims come at a one-week lag to initial claims.
Total claims, or the number of recipients of benefits across all state and federal programs, was lower by 86,615 at 3.399 million during the week ended February 15. Total claims are delivered at a two-week lag. At the comparable time in 2013, there were 5.402 million people collecting benefits.
Thirty-six states and territories reported a drop in claims and 17 reported an increase in the week ended Feb. 22. The largest increases were in Georgia (+7,383), Massachusetts (+3,502) and South Carolina (+3,320). The largest decreases were in California (-4,973), Missouri (-3,642) and New York (-3,572).
Wall Street is cheering the report in early morning trading Thursday. The Dow Jones Industrial Average is up by 67 points, the broader S&P 500 has climbed 7 points and the tech-heavy Nasdaq has gained 11 points.