Jobless Claims Continue to Hold Around 450,000

The good news: Initial jobless benefit claims declined last week, to 453,000. Economists had expected jobless claims to come in at 455,000. The bad news: The number remains very high, the Labor Department revised its estimate for the previous week upward and the four-week average increased by 1,750 people to 459,000.

Starting last spring, weekly initial jobless benefit claims slid downward. In the past few months, that decline has stopped. Essentially, the economy is improving but not adding nearly enough new jobs to bring the unemployment rate down, and if the unemployment rate does not come down, it slows down the recovery. Here is a chart of the claims since January 2008, with the stabilization around 450,000 on the right-hand side: