WASHINGTON – Fewer U.S. workers filed new applications for unemployment benefits last week, a sign that companies may be feeling better about the economic recovery's staying power and are slowing the pace of layoffs.
The Labor Department (search) reported Thursday that for the week ending Nov. 15, new claims for jobless benefits declined by a seasonally adjusted 15,000 to 355,000. For seven straight weeks claims have been below the 400,000 mark, suggesting that the job market is turning a corner.
Economists believe the worst of the layoffs is over. Claims hit a high this year of 459,000 in the middle of April and have slowly drifted downward.
The more stable four-week moving average (search) of claims, which smooths out week-to-week fluctuations, fell by 9,000 to 367,250 last week, the best showing since the week ending Feb. 24, 2001.
The nation's unemployment rate dipped to 6 percent in October as the economy added jobs for the third straight month, a promising note for the labor market, which has seen millions of jobs evaporate over the last three years.
The economy roared ahead at a 7.2 percent annual rate in the third quarter, the fastest pace in nearly two decades. Analysts believe the economy will grow at a solid 4 percent pace in the current quarter.
Even as the economy grows, it will still take time for the labor market to fully turn around, economists say. And, an influx of job seekers motivated by an improved economic climate could cause the unemployment rate to rise in the months ahead if job creation isn't strong enough, economists say.
The Federal Reserve (search), wanting to see more improvement in the jobs picture, is expected to hold a main short-term interest rate at a 45-year low of 1 percent when it meets next on Dec. 9. Economists believe rates could stay near rock-bottom levels into part of 2004.