Unemployment benefits first-time claims fell to the lowest point in four years showing improving health for a still anemic economy.
“The housing starts and unemployment claims numbers add to the belief that the economy is shifting gears,’’ Joel Naroff, president of Naroff Economic Advisers, told the Associated Press. “The decline in the unemployment rate is real, and it should continue.’’
According to the Department of Labor most recent data, unemployment claims fell by 13,000 last week to 348,000 – the lowest point since March 2008, when President George W. Bush was in office.
The four-week average was 365,250, a decrease of 1,750 for the previous week.
In the meantime, the Department of Commerce announced that the production of new homes rose 1.5 percent to 699,000 units in January. It was also 9.9 percent increase from January 2011.
The data “support our view that homebuilders are shaking off the shackles of the last five years and are beginning to contribute to growth,” Paul Dales, an economist with Capital Economics, told Fox News. “That said, the housing sector is currently not big enough to set the economy alight.”
Real estate professionals urge caution, though. They say while it appears the economy is improving, it’s nowhere near where it needs to be to be considered healthy.
“Housing production is still far from what would be considered normal in a healthy market, and many challenges remain for home builders in terms of tight credit conditions, difficult appraisals and the continued flow of foreclosed properties on the market,” David Crowe, chief economist with the National Association of Home Builders (NAHB), told The Hill. “All of which are certainly slowing the pace of improvement in both housing and the overall economy.”