By Msnbc.com staff and wire
The labor market got another jot of good news Thursday when the government reported a surprise drop in jobless claims to their lowest level in 3-1/2 years.
The Labor Department reported that new claims for jobless benefits dropped by 4,000 in the latest week to a?seasonally-adjusted?364,000. That's?the lowest since April 2008 and well below expectations of an increase to 375,000, raising hopes, at least for now, that the labor market is on the mend.
The 4-week moving average, considered a more accurate barometer of labor market conditions,?was 380,250, a decrease of 8,000 from the previous week's revised average of 388,250.
"No change in the script here. The employment situation continues to show strong signs of a recovery and goes against the grain of what people felt four months ago. There has been a limited impact from the euro zone fallout and hopefully 2012 will be equally strong," Miller Tabak chief economic strategist Andrew?Wilkinson told Reuters.?
The U.S. economy has shown signs it is gaining steam as the year ends, although the recovery still could be derailed by any big flare up in Europe's debt crisis. The economy also faces risks from the fight in Congress over extending special unemployment benefits and a payroll tax cut.?
The level of unemployment claims has fallen in recent weeks, and analysts say fewer layoffs means employers are probably more likely to hire.
Economists at Goldman Sachs said earlier in the week that weekly claims below 435,000 pointed to net monthly gains in jobs. Their research was based on figures available through October.
In November, the jobless rate dropped to a 2-1/2 year low of 8.6 percent. The Federal Reserve last week acknowledged an improvement in the jobs market, but said unemployment remained high and left the door open for further measures to help the economy.
A Labor Department official said claims were not estimated for any states, and that there was nothing unusual in the data.
About 6.7 million people are receiving unemployment benefits. About 2.2 million of them will lose their benefits by mid-February and 3.6 million others will lose theirs by the end of March if Congress doesn't extend the emergency benefits.
Lawmakers are deadlocked over continuing the program, which is attached to legislation that would extend a Social Security tax cut.
House Republicans rejected a two-month extension passed by a bipartisan majority in the Senate. President Barack Obama has called on lawmakers to approve the short-term measure so that they will have time to negotiate a full-year extension.
If Congress doesn't renew the two measures for 2012, economists say, the economy's growth could slow by as much as 1 percentage point.
Reuters contributed to this report.
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