WASHINGTON (AP) -- The number of Americans seeking unemployment benefits fell sharply for a fourth straight week, a sign that the job market may be improving.
The Labor Department said Thursday that weekly applications for unemployment benefits fell 29,000 last week to a seasonally adjusted 343,000, the lowest in two months. It is the second-lowest total this year.
Applications are a proxy for layoffs, so the drop indicates that companies are cutting fewer jobs. But employers also need to step up hiring to rapidly push down the unemployment rate.
The drop suggests that companies aren’t laying off workers in advance of the "fiscal cliff," the package of tax increases and spending cuts set to take effect early next year.
"Worries about the fiscal cliff are not translating into any significant weakening in the labor market yet," said Jim O’Sullivan, an economist at High Frequency Economics. "Today’s reading suggests net improvement, although it is just one week."
Applications spiked five weeks ago because of Superstorm Sandy. The storm’s impact has now faded.