Following last week’s much better than expected monthly jobs report, the Labor Department released a report on Thursday showing first-time claims for U.S. unemployment benefits fell to a four-month low in the week ended March 6th.
The Labor Department said initial jobless claims dropped to 712,000, a decrease of 42,000 from the previous week’s revised level of 754,000.
Economists had expected jobless claims to dip to 725,000 from the 745,000 originally reported for the previous week.
With the bigger than expected decrease, jobless claims fell to their lowest level since hitting 711,000 in the week ended November 7th.
The report showed the less volatile four-week moving average also slid to 759,000, a decrease of 34,000 from the previous week’s revised average of 793,000.
Continuing claims, a reading on the number of people receiving ongoing unemployment assistance, also declined by 193,000 to 4.144 million in the week ended February 27th.
The four-week moving average of continuing claims dropped to 4,355,000, a decrease of 103,500 from the previous week’s revised average of 4,458,500.
Despite the decrease in regular state jobless benefits, Nancy Vanden Houten, Lead Economist at Oxford Economics, noted combined claims for regular and emergency benefits were stuck at 1.2 million.
“The February jobs report confirmed a labor market recovery is underway, but showed that employment remains 9.5 million below pre-pandemic levels,” Vanden Houten said.
She added, “That shortfall, along with the elevated level of claims, reminds us that the healing of the labor market will take time.”
Last Friday, the Labor Department released a more closely watched report showing much stronger than expected U.S. job growth in the month of February.
The report said non-farm payroll employment jumped by 379,000 jobs in February after climbing by an upwardly revised 166,000 jobs in January.
Economists had expected employment to increase by 182,000 jobs compared to the uptick of 49,000 jobs originally reported for the previous month.
The stronger than expected job growth was primarily due to a rebound in employment in the leisure and hospitality industry, which added 355,000 jobs.
The Labor Department also said the unemployment rate unexpectedly edged down to 6.2 percent in February from 6.3 percent in January. Economists had expected the unemployment rate to remain unchanged.