By Bob Willis Nov. 25 (Bloomberg) -- The number of Americans filing claims for unemployment benefits fell last week to the lowest level since September 2008 as the economic recovery encourages companies to fire fewer workers. Initial jobless claims declined to 466,000 in the week ended Nov. 21 from 501,000 a week earlier, Labor Department figures showed today in Washington. The number of people collecting unemployment insurance dropped in the prior week, while those getting extended payments also declined. After slashing more than 7 million jobs in the past two years, companies may have little margin to cut further without threatening their capacity to ramp up production as the economy recovers. The government may report next week that employers in November shed the fewest jobs in 20 months. “Falling claims suggest that fewer workers are losing their jobs,” Dana Saporta, an economist at Stone & McCarthy Research in Skillman, New Jersey, said before the report. “Stabilization in the labor market would obviously be good news for consumer spending, but we still do not look for robust consumption growth anytime soon.” Jobless claims were estimated to decrease to 500,000 from 505,000 initially reported for the prior week, according to the median forecast of 43 economists in a Bloomberg News survey. Estimates ranged from 460,000 to 512,000. The Labor Department released the data a day earlier than usual because of tomorrow’s Thanksgiving holiday. Last week’s claims were the fewest since 459,000 in the week ended Sept. 13, 2008. Four-Week Average The report showed the four-week moving average of initial claims, a less volatile measure, dropped to 496,500 last week from 513,000 the prior week. Continuing claims declined by 190,000 in the week ended Nov. 14 to 5.423 million. They were forecast to drop to 5.57 million. The continuing claims figure does not include the number of Americans receiving extended benefits under federal programs. Today’s report showed the number of people who’ve used up their traditional benefits and are now collecting extended payments fell by 18,253 to 4.18 million in the week ended Nov. 7. President Barack Obama on Nov. 6 signed into law a plan to extend jobless benefits, giving the unemployed as many as 20 additional weeks of assistance. The economy probably lost 125,000 jobs in November, the least since March 2008, economists surveyed by Bloomberg forecast the Labor Department will report on Dec. 4. The jobless rate probably stayed at a 26-year high of 10.2 percent for a second month, economists forecast. Unemployment Rate Today’s report showed the unemployment rate among people eligible for jobless benefits, which tends to track the jobless rate, fell to 4.1 percent in the week ended Nov. 14 from 4.3 percent. The correlation has broken down this year as more people receive extended payments. Forty-nine states and territories reported a decrease in claims, while four reported an increase. These data are reported with a one-week lag. Initial jobless claims reflect weekly firings. They have risen as job growth -- measured by the monthly non-farm payrolls report -- has been negative since January 2008. AOL, the Internet unit being spun off from Time Warner Inc. in December, plans to cut about one-third of its 6,900 employees over the next several months. The company will begin a voluntary layoff program Dec. 4 and is looking for as many as 2,500 volunteers, AOL spokeswoman Tricia Primrose said in an e-mail last week. The company will make up the shortfall of volunteers through firings, she said. Harley-Davidson Inc., the biggest U.S. motorcycle maker, last week reached a tentative labor agreement that would keep open a York, Pennsylvania, factory while reducing the 1,950 unionized workforce to about 1,100, said Bob Klein, a company spokesman. To contact the reporters on this story: Bob Willis in Washington bwillis@bloomberg.net

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