US labor department says fewer people are filing for unemployment benefits, beating economists' expectations
The number of US workers filing for unemployment benefits is now at its lowest level since April 2008, according to government figures released Thursday.
A four-year low in benefit claims, which beat economists' expectations, is the latest sign that the US job market is on the mend just as Europe's economic woes once again hit the headlines.
The labor department said initial jobless claims fell by 5,000 to a seasonally adjusted 359,000 in the week ending 24 March. Economists surveyed by Dow Jones Newswires had forecast that claims would increase by 2,000.
The recovering job market is seen as a boost for President Barack Obama's re-election prospects. But Federal Reserve chairman Ben Bernanke recently warned that the job market comeback may be "out of sync" with the wider economy and that major problems remain.
The next big test comes on 6 April when the monthly nonfarm payroll figures are released, the US government's authoritative monthly measure of the job market.
Thursday's jobs news came amid signs of more woe in the European economies. Paris-based think-tank OECD said in its lastest report that the UK is deep in recession and will be among the slowest of the world's largest economies to recover. The OECD said only Italy will struggle over a longer period to return to growth.
The Office for National Statistics added to the gloomy picture Wednesday by reporting that it had underestimated the declining fortunes of the UK's economy at the end of last year.
The UK's problems came as a demonstrators and police clashed in Spain at the start of a general strike against planned labour reforms.
Gus Faucher, senior macroeconomist at PNC Financial Services Group, said the US economy now seemed to be on a path to sustainable recovery. He cautioned that for the past two years recoveries had fizzled out in the US in the spring but said this time the signs looked more positive.
"Europe on the other hand is still being dragged down by its fiscal problems. In particular the fiscal austerity plans in the UK seem to have been counterproductive," he said. In the US there has been a lot of talk about cutting the defecit but not a lot of action. And I think that has proved to be the right move for now. Hopefully we will learn from what has happened in the UK."
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