Jobless aid filings drop
By Kevin Smith, Staff Writer© Pasadena Star-News, February 11, 2011
Applications at lowest point since July 2008
The number of people applying for unemployment benefits plunged last week to the lowest level in nearly three years, continuing a downward trend that suggests hiring could pick up this year.
Applications sank by a seasonally adjusted 36,000 to 383,000, the lowest point since early July 2008, the Labor Department reported Thursday.
Some analysts cautioned that severe winter weather that affected 30 states could have contributed to the sharp drop, closing some government offices and preventing people from filing applications.
Still, many analysts said the decline points to better hiring ahead.
"The sharp drop bodes well for February job creation," said economist Ellen Beeson Zentner at Bank of Tokyo-Mitsubishi UFJ.
But Gary Kaplan, president of Gary Kaplan & Associates, a Pasadena-based executive search firm, said it might be a bit early to expect a significant improvement.
"I'm still getting a steady stream every day of newly released people - people who had worked at substantial levels," he said. "The number almost feels like it's spiked again. I'm inundated every day with people who are looking for my guidance. They are very concerned."
Applications are well below their peak of 651,000, reached in March 2009, when the economy was deep in recession.
Applications below 425,000 tend to signal modest job growth. But they would need to dip consistently to 375,000 or below to indicate a significant and steady decline in the unemployment rate.
When unemployment was at a more normal rate of 5 percent in 2005, applications hovered around 322,000. In boom times, when unemployment dipped to a 30-year low of 3.8 percent in April 2000, applications fell to 259,000.
Last week's sharp decline continues a downward trend that took shape late last year. The last time applications fell below 400,000 was near the end of December.
