US jobless claims drop to 5-year low of 330,000

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US jobless claims drop to 5-year low of 330,000

In this Thursday, Oct. 25, 2012, photo, Carmen Nazario of Albany, N.Y., fills out an employment application during a job fair at the Marriott Hotel in Colonie, N.Y. The number of people seeking unemployment benefits fell last week by 8,000 to a seasonally adjusted 355,000, a possible sign of a healing job market. But officials cautioned that the figures were distorted by Superstorm Sandy. (AP Photo/Mike Groll)

WASHINGTON (AP) - The number of Americans seeking unemployment aid fell last week to the lowest level in five years, evidence that employers are cutting fewer jobs and may step up hiring.

The Labor Department says weekly unemployment benefit applications dropped 5,000 to a seasonally adjusted 330,000. That's the fewest since January 2008. The four-week average, a less volatile measure, fell to 351,750. That's also the lowest in nearly five years.

The decline may reflect the government's difficulty adjusting its numbers to account for layoffs after the holiday shopping season. Layoffs spike in the second week of January and then plummet. The department seeks to adjust for those trends, but the figures can still be volatile.

Applications are a proxy for layoffs. While layoffs are falling, hiring has been modest in recent months.

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