December 31, 2008 9:18 AM

Good unemployment news? Not really
Posted by Jesse Nunesat 9:18 AM

As the dismal economic news seems to continue to hit the country like young Mike Tyson uppercuts, the AP reports today on something that may seem encouraging: The number of newly laid off workers signing up for unemployment fell sharply last week.

However, before you get out your noise makers and celebrate the return of a strong job market, you may want to read past the headline and realize things are still bad, and there's probably a very logical explanation for the weekly drop in filings. From the AP:

The Labor Department reported today that first-time applications filed for jobless benefits dropped by a seasonally adjusted 94,000 to 492,000 for the week ending Dec. 27.

That decline, however, didn't signal any improvement in labor conditions. The drop -- while bigger than economists expected -- was partly related to seasonal adjustment difficulties and reflected some out-of-work people not making it to unemployment offices to file claims over the Christmas holiday, analysts said.

Even with the drop, new filings remained elevated. A year ago, claims stood at 339,000.

Laid-off workers continuing to draw unemployment benefits increased by 140,000 to 4.5 million for the week ending Dec. 20, the most recent period for which that information is available. That was the most since early December 1982, when the country was emerging from a deep recession.

Although the number of people who continue to draw unemployment benefits may seem high, it's also important to remember that the benefits have been extended for many people, so it stands to reason that more people will be drawing at any one time.

Still, the news is not good, and doesn't look to get better overnight. Sorry to be a buzzkill, all you New Year's partiers.