Initial Jobless Claims Fall To Seven-Month Low

Washington, DC, July 16, 2009--Initial jobless claims fell sharply last week to the lowest level since January, the government said on Thursday.

Initial claims fell 47,000 to a less-than-expected seasonally adjusted 522,000 in the week ended July 11, the Labor Department said. Analysts had forecast claims to be unchanged at 565,000 last week.

The Labor Department said that far fewer layoffs than anticipated, based on past experience in the automotive sector and elsewhere in manufacturing, accounted for both the large drop in seasonally adjusted claims and the very steep decline in so-called continued claims.

“The big drop is not necessarily a reflection of what is going on in the economy,” he said.

Continued claims of people still on jobless aid after an initial week of benefits fell to 6.273 million in the week ending July 4, the latest for which data is available.

It was the lowest reading since April and the largest one-week decline on record. Analysts had forecast continued claims would decline to 6.85 million.

In another important gauge of labor market health, the four-week moving average for new claims fell to 584,500 from 607,000, the lowest since January.