New weekly jobless claims fall by 21,000, an eight-week low
UPDATED at 12:21 p.m. with impact of automakers:
The number of new jobless claims filed last week dropped by 21,000 to 454,000, the lowest number in eight weeks.
Even more promising, the number of continuing claims dropped by 224,000 to 4.4 million.
The four-week moving average of new unemployment claims, which smooths out week-to-week volatility, dropped by 1,250 to 466,000.
Note, however, that this is just a first pass at these data. We'll take a closer look at the context later today to try to figure out whether the raw numbers are as encouraging as they look or whether there are reasons for the drop in new claims that may speak to larger economic problems.
UPDATE: One of the reasons that fewer people applied for unemployment last week was U.S. automakers. The Big Three are not shutting down production as much as they typically do in July. So those workers are still in jobs.
Economists say that the economy cannot start meaningful new job creation until the number of new weekly jobless claims gets down into the low 400,000s and stays there. The weekly number has refused to budge past the mid-400s,000s.
The national unemployment rate in June was 9.5 percent. The number is down from 9.7 percent the previous month, but mostly because so many people left the labor force, not necessarily because more people got jobs.
We'll see how the markets respond to the jobs data when they open in less than an hour and find out whether Wall Street can put together a three-day rally.
July 8, 2010; 12:21 PM ET
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