WASHINGTON (Talon News) — Unemployment claims dropped last week to the lowest level since George W. Bush was inaugurated president, according to the latest jobless benefits report released by the Labor Department on Wednesday.
New unemployment insurance requests fell to 339,000 for the week ending December 27. Jobless claims have not been this low since January 20, 2001, the day President Bush was sworn into office as president of the United States.
Economists credit this good news in the job market to an increase in consumer confidence in the U.S. economy. They also say that business owners have ceased the layoffs and are beginning to hire new workers again as the economy continues to get better. Also, businesses are investing more capital in the economy, which will help the economy recover even faster.
In fact, a recent Conference Board report estimates that more than one million new jobs will be created in 2004 as unemployment continues to fall significantly.
Ken Mayland, president of ClearView Economics, says he sees job creation ready to explode.
“There is clearly reason for optimism that we are getting on a significant job-generation track,” he told the Associated Press.
Talon News reported on a recent AP poll that found there to be optimism by the American people about the job market in 2004. The poll showed that 57 percent are either as confident or more confident in their job security than they were six months ago while only 42 percent say they are less confident.
Most economic experts have been confounded by the noticeable fall in unemployment benefit claims over the past few months, which have been substantially better than any of them predicted. In fact, jobless claims have been below the 400,000 mark for 13 weeks in a row. Most economists view unemployment insurance claims below the 400,000 mark as a sign of a stable and strengthening job market.
Talon News has reported on the steady decline in jobless claims since last spring. In mid-April, new jobless claims grew to 459,000, but the decline has been clearly evident ever since. Even Federal Reserve Chairman Alan Greenspan commented recently that he believes the decline in the job market has stabilized.
Some credit the increased confidence in the economy to the tax cuts passed by Congress and signed into law by President Bush last year.
Unemployment, which was as high as 6.4 percent over last summer, fell to 5.9 percent by the end of 2003.
However, economists have long contended that the job market is the slowest part of the economy to recover after a recession.
Regardless, Talon News has previously reported the economy grew at an astounding 8.2 percent in the third quarter, which was the best since the Reagan administration. And although the fourth quarter is not expected to be that high, the growth rate will likely be close to 5 percent and would propel the economy forward in the new year.
A USA Today survey of 57 economists recently predicted 2004 will be the best year for growth in the American economy in a decade and that unemployment will dip to 5.5 percent.
Additionally, these economists were unanimous in their belief that Bush will be reelected in 2004 because of the improvements in the economy and the job market.