Weekly jobless claims drop by 23,000

New applications for jobless aid dropped by 23,000 last week, according to figures released by the Labor Department on Thursday.

For the week ending Jan. 29, seasonally adjusted initial claims reached 238,000, the data found. The four-week moving average rose to 255,000 last week, 7,750 more than the revised average from the previous week.

The report marks the second week in a row that jobless claims have fallen after previously rising for several weeks. 

Last November, jobless claims dropped to levels not seen since before the onset of the pandemic. But applications for jobless aid made gains in the following weeks, as the omicron variant of COVID-19 fueled a nationwide spike in infections. 

Data released by the Census Bureau last month found that millions of people missed work at the start of the year because they, or a person they cared for, came down with the illness. 

The data comes as some economists prepare for a less than pleasant January jobs report, which is set for release Friday, as experts brace for a hitch in economic growth brought on by the impact of the recent omicron surge.

Overall, the economy grew nearly 6 percent last year in a sharp rebound that experts have credited to multiple factors, including significant vaccine and relief efforts.  

In the fourth quarter, economic growth reached an annualized pace of 6.9 percent, government data found. Jobless rates also dipped at the end of the year to less than 4 percent. 

However, employment gains made last month are expected to be the latest casualty of the omicron wave, slowing economic growth in what economists are hopeful will be a temporary setback.

–Updated at 9:07 a.m.