Jobless Claims Drop More Than Expected, Down by 16,000 to 339,000

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The number of Americans filing new claims for unemployment benefits fell last week, offering reassurance that the bottom is not falling out of the labor market despite signs of slower growth.

Initial claims for state unemployment benefits dropped 16,000 to a seasonally adjusted 339,000 the Labor Department said on Thursday. The prior week's number was revised to show 3,000 more applications than previously reported.

Analysts had expected 351,000 new claims last week.

A Labor Department analyst said there was nothing unusual in the data and no states had estimated their claims.

The report runs counter to several weeks of signals that economic activity has softened over the last two months, a phenomena economists have dubbed the spring swoon because it also happened in the previous two years.

The four-week moving average for new claims, a less volatile measure of labor market trends, fell 4,500 to 357,500.

(Read the full report here.)

That could help to further ease concerns of a deterioration in labor market conditions after nonfarm payrolls posted their smallest increase in nine months in March. However, claims around this time of the year are difficult to adjust for seasonal swings, so analysts will be cautious about extrapolating too much from today's data.

Economists expect the government next week will report that employers hired 145,000 people in April. Employers added 88,000 workers to their payrolls last month after a solid 268,000 increase in February.

Economic data for January and February suggested that growth accelerated in the first quarter after activity almost stalled in the final three months of 2012.

But in a replay of the prior two years, the economy appeared to have hit a speed bump at the end of the quarter, with data ranging from employment to retail sales and manufacturing weakening significantly in March.

The slowdown has been largely blamed on belt-tightening in Washington as the government tries to slash its bloated budget deficit.

It was unclear whether there was any impact in the claims data from a brief shutdown of offices in Boston area last week as police hunted for a man suspected of helping plant bombs at the Boston Marathon. State authorities asked hundreds of thousands of Boston-area workers to stay in their homes on April 19