Jobless Claims Drop, Productivity Up

WASHINGTON - The number of people filing new applications for unemployment benefits dropped last week, a sign that companies may be feeling better about the economic recovery's durability and less inclined to lay off workers.

The Labor Department reported Thursday that for the work week ending Feb. 28 new filings for jobless benefits declined by a seasonally adjusted 7,000 to 345,000, the lowest level in two weeks. The decline was a bit larger than the decrease of 5,000 that some analysts were forecasting.

In another report from the department, the productivity of American workers grew at a modest 2.6 percent annual rate in the final three months of 2003, according to revised figures. The new figure, which matched economists' expectations, was slightly slower than the 2.7 percent pace first estimated a month ago.

Productivity measures the amount a worker produces for each hour on the job.

Although the fourth-quarter's performance marked a slowdown from a sizable 9.5 percent growth rate in the previous quarter, it still represented a respectable pace that bodes well for the economic recovery.