WASHINGTON, July 24 (UPI) -- The number of Americans filing for unemployment benefits fell sharply, reaching an eight-year low, as the economy continues to improve leading to a stronger labor market.
The number of claims dropped by 19,000 to a seasonally adjusted 284,000 for the week ending July 19, according to the Labor Department. This is the lowest level seen since February 2006 and was below the 305,000 mark estimated by economists polled by The Wall Street Journal.*
The estimate for the previous week was revised up slightly, with the four-week moving average dropping by 7,250 to 302,000, the lowest since May 2007. The number of people continuing to receive benefits dropped 8,000 to 3.5 million, the lowest it's been since June 2007.
Fewer claims are a sign employers are reluctant to lay off employees, and as sales continue to improve so will wages, increasing consumer spending, which accounts for 70 percent of the U.S. economy.
Claims are usually volatile this time of year as many auto companies shut down to prepare for new models and because of school vacations. But many carmakers have minimized these shutdowns in order to take advantage of brisk auto sales.
A Labor Department analysis said there was nothing unusual in the data beyond expected seasonal factors.