Unemployment Claims Hit Eight-Year Low; They're at Levels Last Seen During Economic Expansions
In the latest sign of an improving labor market, the number of people filing new claims for unemployment benefits in the second week of August was 298,000, marking the third time in five weeks it had fallen below 300,000.</br></br>The last time claims were so low was in early 2000 and 2006, at the height of previous economic expansions. Jobless claims, a proxy for layoffs, are also near record lows when population growth is taken into account.</br></br>Yet the improvement seems out of step with other labor-market indicators. The nation's unemployment rate was 6.2% in July, a historically elevated rate for this point in the recovery, and many economists believe even that gauge overstates the true health of the job market. The jobless rate doesn't capture, for example, discouraged workers who have given up their job searches.</br></br>Economists believe that one reason for a lower rate of layoffs is a labor market that has become generally less dynamic over the last few decades. Employers have become less likely to lay off workers over time, though they have also grown more cautious about hiring. Similarly, workers have grown more reluctant to change jobs, possibly stunting career development and earnings growth as a result.</br></br>But more recently, most of the fall in jobless claims has been driven by a decline in the number of the newly laid off who don't bother to apply for government benefits in a generally improving economy.