Fewer Americans sought unemployment benefits last week, as the number of people collecting jobless aid fell to its lowest level in more than six years. The Labor Department said today that weekly applications for unemployment benefits fell 6,000 to a seasonally adjusted 312,000. The four-week average, a less volatile measure, declined to 311,750. There are 2.56 million people receiving benefits. That's the lowest total since October 2007, about two months before the recession began. An economist said the report in a "blinding glimpse of the obvious" is clearly "good news."
Applications are a proxy for layoffs, so the relatively low number of people seeking benefits shows that employers are letting go of fewer workers. When businesses are confident enough to keep staff, they may also hire more workers. Job gains should feed stronger economic growth. Monthly job gains have averaged 234,000 for the past three months, up sharply from 150,000 in the previous three. The unemployment rate, which is derived from a separate survey, remained at 6.3% in May—still, that's the lowest rate in more than five years. The low level of applications would suggest similarly strong hiring this month. (Read more unemployment benefits stories.)