Reports of lower unemployment benefit claims followed an improved November unemployment report, the Labor Department said Thursday. Claims for state unemployment benefits dropped by 19,000 last week to a seasonally adjusted 366,000, the lowest level since May 2008.
Reuters reported that “[t]he unexpected drop in claims last week pushed them closer to the 350,000 mark that analysts say signals labor market strength.”
Generally, 350,000 is the estimated number needed to signal strong hiring. Fewer unemployment benefits translates to fewer layoffs and ultimately a more robust job market.
The November unemployment rate was 8.6 percent, with 120,000 jobs added.
Many, however, are asking if this shift in job statistics is a sign of real growth, or just an accounting illusion.
“The reality is … 300,000 people just decided to throw their hands in the air and say, ‘Look, this economy is so bad that I’m not even going to file with the department of Labor and tell them that I can’t find a job,’” Republican National Committee chriamsn Reince Priebus said on the Fox Business Network.
“This is not good news,” he added. “This is nothing for the [Obama] administration to brag about.”
Alternative estimates of real unemployment, including discouraged workers, put the figure around 11 percent. Some estimates have been as high as 20 percent.
“We’re right at the point where the economy is growing, but not enough to offset productivity and create jobs,”Boeing CEO Jim McNerney said. “Everybody’s doing things more efficiently.”
The small-business optimism index rose for the third straight month, from 90.2 to 92.0, according to the National Federation of Independent Business. That number is still below the pre-recession average.