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A jobs sign hangs above the entrance to the US Chamber of Commerce building in Washington, DC. New claims for US unemployment insurance dropped last week to a level last seen more than three years ago, government data showed December 15, 2011 in a sign of stabilization in the troubled jobs market.
There's been a big debate in economics over the past few months about whether the U.S. will fall into another recession. One side points to continued high unemployment and sluggish growth, as well as the perception that the economy is in the dumps (and in an economy, perception is very important to consumer behavior, which accounts for 70 percent of economic activity in the U.S.).
The other side says, basically, that we aren't seeing unemployment go up or GDP growth go down, and besides, most industries have declined so far that there's nowhere to go but up. Therefore, no double-dip recession.
The data favors the latter argument. This is from the LA Times:
Growth has picked up steam through the fall as dropping gas prices put more money in consumers' pockets and businesses rebuilt their inventories. Economists project the annualized growth rate from October through the end of the year could be as high as 4%.
Helping fuel that recovery is continued improvement in the job market.
New jobless claims declined again last week, falling to 364,000, the lowest level since April 2008, the Labor Department said Thursday. The four-week average of 380,250 is below the 400,000 figure that economists say is key to cutting into the unemployment rate.
This is good news. Barring a shock from Europe that affects the banking system in a financial-crisis sort of way, or a China meltdown, it's justification for ringing in a Happy New Year and beginning to think that 2012 might be the year that 2011 was supposed to be.