The number of people applying for unemployment benefits fell sharply last week, a positive sign that the job market is slowly improving.
The Labor Department says applications dropped by 34,000 to 388,000, the lowest number since the week of July 12, 2008. The level of applications has either fallen or remained unchanged in five of the past six weeks.
Unemployment applications below 425,000 signal modest job growth. But economists say applications need to fall to 375,000 or below to indicate a significant decline in unemployment. Applications for unemployment benefits peaked during the recession at 651,000 in March 2009.
The level of applications can be particularly volatile during the holidays. But a department analyst said there were no unusual factors affecting the report.