Jobless claims point to labor recovery momentum

Thu Dec 13, 2012 10:28am EST
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By Jason Lange

WASHINGTON (Reuters) - New jobless claims fell sharply last week to a near four-year low and retail sales rebounded in November, hopeful signs for an economy that appears to have slowed sharply in the fourth quarter.

New claims fell for a fourth straight week, dropping 29,000 to a seasonally adjusted 343,000, the Labor Department said on Thursday.

That left claims at their lowest since early October, and within a hair of their February 2008 level during the early days of the 2007-09 recession.

"The labor market might be improving a bit quicker than expected," said David Sloan, an economist at 4Cast in New York.ž

The report suggests the labor market has moved past superstorm Sandy, which hit the East Coast in late October and led to a temporary spike in claims.

The four-week moving average for new claims, seen as a better measure of labor market trends, dropped 27,000 to 381,500.

A slow but steady improvement in the labor market has helped support retail sales, which propped up economic growth in the third quarter when business investment sagged.

Economic growth is expected to slow in the fourth quarter, beset by slower inventory building and worries among companies that the U.S. government will adopt harsh austerity measures in January.   Continued...

Job seekers stand in line to meet with prospective employers at a career fair in New York City, October 24, 2012. REUTERS/Mike Segar