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Jobless claims inch higher, remain below threshold

After the wild rides of June and July, initial unemployment claims seem to have settled down a bit. The new report from the Department of Labor showed the total inching higher, but only a little.

First-time claims for state unemployment benefits rose in the latest week, the Labor Department reported Thursday. The number of initial claims in the week ending Aug. 11 rose 2,000 to 366,000. The consensus forecast of Wall Street economists was for claims to rise to 365,000. Claims have been at the low end of the recent range. As a result, the four-week average fell 5,500 to 363,750. This is the lowest level since the week ended March 31.

To reiterate the point I make every Thursday morning, it's worth remembering that week-to-week results can vary widely, and it's best not to read too much significance into any one report.

In terms of metrics, when jobless claims fall below the 400,000 threshold, it's considered evidence of an improving jobs landscape, and when the number drops below 370,000, it suggests jobs are being created rather quickly. We've only managed to dip below the 370,000 threshold six times in the last 19 weeks, but here's the good news: we've been below 370,000 in five of the last six weeks.

And with that, here's the chart showing weekly, initial unemployment claims going back to the beginning of 2007. (Remember, unlike the monthly jobs chart, a lower number is good news.) For context, I've added an arrow to show the point at which President Obama's Recovery Act began spending money.