Sep. 27, 2012 at 8:39 AM ET
New claims for unemployment benefits dropped sharply in the latest week, raising hopes for the state of the job market.
The Labor Department reported Thursday that jobless claims fell 26,000 to a seasonally-adjusted 359,000, the lowest since July. The four-week moving average, which smooths out wrinkles in the data, dropped 4,500 to 374,000.
Economists polled by Reuters had forecast claims falling to 378,000 last week. A Labor Department official said there were no special factors influencing the report and no states had been estimated.
The labor market has been mired in weakness as worries about higher taxes and deep government spending cuts in January, the ongoing debt problems in Europe and slowing global growth lead employers to be cautious about ramping up hiring.
Sluggish job gains and stubbornly high unemployment spurred the Federal Reserve this month into launching a third round of bond purchases to drive down already low interest rates.
The U.S. central bank vowed to buy $40 billion worth of mortgage-backed securities each month until it sees a sustained upturn in the labor market.
The unemployment rate has been stuck above 8 percent for more than three years, the first time this has happened since the Great Depression, a hurdle for President Barack Obama's quest for a second term in office.
The claims report showed the number of people still receiving benefits under regular state programs after an initial week of aid fell 4,000 to 3.27 million in the week ended September 15.
The so-called continuing data covered the week for the household survey from which the unemployment rate is derived.
In a separate report, the Labor Department said the economy likely created 386,000 more jobs in the 12 months through March than previously estimated.
Once a year, the department compares its non-farm payroll data, based on monthly surveys of a sample of employers, with a much more complete database of unemployment insurance tax reports.
It said its latest comparison suggests the level of employment in March was 0.3 percent higher than it had previously stated.
A final benchmark revision will be released in February along with the department's report on employment in January. Government statisticians will use the final benchmark count to revise payroll data for months both prior to and after March.
A breakdown by industry sector showed 453,000 more total private sector jobs were created than initially thought, including 145,000 more jobs in the trade, transportation, and utilities category, plus 85,000 more in construction.
In contrast, the benchmark revision lowered the estimate for job creation in the government sector by 65,000, while it found that 25,000 fewer manufacturing jobs had been generated over the 12 month period than previously thought.
Reuters contributed to this report.
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