By Christopher S. Rugaber, AP Economics Writer
WASHINGTON (AP) — The number of Americans applying for unemployment benefits dropped to the lowest level since May 2008, a sign that layoffs are declining and hiring is picking up.
The Labor Department said Thursday that weekly applications fell by 19,000 to a seasonally adjusted 366,000 last week.
The four-week average, a less volatile measure, dropped to 387,750. That is the lowest reading for the average since July 2008. The four-week average has declined in 10 of the past 12 weeks.
Applications for unemployment benefits are a measure of the pace of layoffs. Job cuts have fallen sharply since the recession, but so far employers are hiring at only a modest pace. When applications fall below 375,000 — consistently — that usually signals that hiring is strong enough to lower the unemployment rate.
The downward trend suggests that companies are cutting fewer workers as the economy picks up. It also comes as Congress is arguing over whether to extend emergency unemployment benefits, which are set to expire at the end of this year.
Growth may top 3% in the final three months of this year, according to many economists. That would be up from 2% in the July-September quarter.
Other recent reports suggest the job market is improving a bit. In the past three months, net job gains have averaged 143,000 a month. That compares with an average of 84,000 in the previous three months.
In November, employers added 120,000 jobs, and the unemployment rate fell to 8.6% from 9%. That was the lowest unemployment rate in 2½ years. But about half that decline occurred because many of the unemployed gave up looking for work. When people stop looking for a job, they're no longer counted as unemployed.
Employers posted fewer jobs in October than in the previous month, the government said Tuesday, though the decline was modest.