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Jobless claims drop to lowest level since 2008

The number of Americans filing for unemployment benefits dropped to a 4-1/2 year low last week, suggesting that hiring may be picking up after stalling since the spring.

The Labor Department reported Thursday that new jobless claims dropped a seasonally-adjusted 30,000 to 339,000, the lowest since February 2008. The four-week moving average, considered a more accurate gauge of labor market conditions, slid 11,500 to 364,000.

The report is the second slice of good news for the ailing job market in less than a week. President Barack Obama is in an increasingly close battle with GOP rival Mitt Romney with less than a month to go until the presidential election and upbeat data on housing and jobs recently could help boost Obama's chances. 

A Labor Department analyst noted that seasonal factors had predicted a very large increase in claims last week, which he said would be typical for the first week of the calendar quarter. Unadjusted claims did rise, but far less than expected, resulting in the sharp drop in the seasonally adjusted figure.

The analyst cautioned against reading too much into one week's figure, and noted that one state had reported a decline in claims last week when an increase was expected. He said no states had been estimated for the report.

Unemployment benefit applications are a measure of the pace of layoffs. When they consistently fall below 375,000, it typically indicates that hiring is strong enough to lower the unemployment rate.

Applications have mostly stayed near or above that level since the spring, coinciding with a weak stretch of hiring.

The figures come after last week's surprisingly strong employment report for September, which showed the unemployment rate fell below 8 percent for the first time in more than 3-1/2 years. It fell because a government survey of households found that 873,000 more people had jobs, the biggest jump in nearly 10 years. A jump in part-time employment accounted for most of the gain.

"There was a big surprise in the fall. It was probably partly erratic and assisted by seasonal adjustments, given the fall we have had in the unemployment rate. It does seem like there is something going on maybe in the labor market," said economist David Sloan at 4Cast Ltd.

Employers, meanwhile, added 114,000 jobs in September, according to a separate survey of businesses. Hiring in July and August were revised much higher.

As a result, hiring over the summer was stronger than previously estimated. The economy gained an average of 146,000 jobs a month in the July-September quarter. That's more than double the monthly pace in the April-June quarter.

Even so, hiring must be stronger to bring relief to the more than 12 million people who are unemployed. Roughly 100,000 new jobs are needed each month to keep up with the working-age population.

Another report Wednesday suggested hiring will likely remain modest. Employers posted slightly fewer open jobs in August compared with July, the Labor Department said. It was the second straight monthly drop and the fewest openings since April.

A key problem is the economy is not growing fast enough to generate much hiring. Growth slowed to a tepid annual rate of 1.3 percent in the April-June quarter, down from 2 percent in the previous quarter. Most economists see growth staying at or below 2 percent in the second half of the year.

The Associated Press and Reuters contributed to this report.

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CNBC's Kelly Evans revisits the current jobless claims numbers to see if they add up.