CHART: This Week's Huge Jobless Claims Drop In Context

Initial claims surprised even the most bullish economists on the street, falling to 350,000 first time filers from last week’s revised 376,000.

That’s the lowest level since March 2008, but it follows a seasonal trend over the July 4th holiday (which you’ll see in the chart below).

However, the decline in this week’s data shows a substantively greater drop than in the past two years — when rates dropped by four and three per cent.

This year, claims dropped seven per cent week-on-week during the period including July 4th.

Millan Mulraine of TD Securities noted most of the improvement was due to fewer seasonal factory shutdowns as plants continued to operate through the summer months. 

“This should be corrected in the coming weeks, and the level of claims should revert back to level more consistent with the weak tone in labour market activity, possibly rising back to above the 370K level,” Mulraine says.

Take a look at initial claims overlaid by year.

Initial Jobless Claims (7/7/12)

Photo: Eric Platt/Business Insider

And now, claims over the past three years.

Initial Jobless Claims (7/7/12)

Photo: Eric Platt/Business Insider

SEE ALSO: Chris Rupkey — The Jobs Slowdown Is A Myth, And The Expansion Is On Track >

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.