Jobless claims fell last week, settling at the lowest level since late-November. The news follows yesterday’s encouraging employment report from ADP. Taken together, the data suggest that tomorrow’s December payrolls report from the Labor Department will also offer more support for thinking that economic growth is picking up.
Meantime, new filings for unemployment benefits fell 15,000 last week to a seasonally adjusted 330,000. The drop was enough to pull down the four-week moving average for claims—the first decline since the week through November 30.
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A stronger signal that the labor market is healing can be seen in the year-over-year decrease in new claims, which fell nearly 12% last week vs. the year-earlier level. Here too we have the biggest retreat since late-November.
“The labor market is continuing to strengthen as we go into 2014,” says UBS economist Kevin Cummins. “We should continue to see the unemployment rate go lower.” Deciding if that’s a reasonable forecast begins by analyzing tomorrow’s payrolls report. For the moment, the outlook is bullish on this front as well.