After spending much of 2010 criticizing the media for misreporting unemployment figures, I feel the need to credit them for getting something right — even if the AP only gets it half-right, as they do today.  The Department of Labor’s new figures on initial jobless claims show a reduction of 19,000 from the previous week, which had sharply spiked upward.  However, even while promoting the decline as “the largest amount in two months,” the AP mainly focuses on the fact that nothing much has changed this year at all:

Initial claims for jobless benefits fell by the largest amount in two months last week, but remain above levels consistent with healthy job growth.

Despite the drop of 19,000, claims are at about the same level they were at the beginning of the year. The stubbornly high level of requests for jobless aid is a sign hiring remains weak even as the economy recovers.

The Labor Department said Thursday that new claims dropped to a seasonally adjusted 457,000. That’s slightly below economists’ forecasts of 460,000, according to Thomson Reuters.

First-time requests for unemployment insurance have been stuck at about 450,000 since the beginning of this year. New claims dropped steadily last year after reaching a peak of 651,000 in March 2009. Claims need to fall closer to 425,000 to signal sustained job growth, many economists say.

Actually, “many economists” put that level at 325,000 for sustained job growth past the addition of 100,000 new working-age Americans being added from population growth each month.  Otherwise, they’re mainly correct about the stagnation in initial jobless claims this year.  The 457,000 figure from today is almost identical to the 456,000 figure from the first week of January, and the trendline is remarkably stable:

It’s also worth noting that the previous “biggest drop” took us to almost precisely the same level we see today.  That took place in WE 4/17/2010, when initial jobless claims dropped from 484,000 to 456,000.  This shows that the numbers aren’t moving at all, but merely bouncing around in a narrow band of statistical noise.  The AP’s Christopher Rugaber correctly notes this in his article.

And it’s not just the AP wondering about whether we actually have growth or not. The Federal Reserve also changed its tune:

The Federal Reserve on Wednesday provided a more cautious outlook as it kept a key interest rate it controls near record lows. The Fed said the economic recovery is “proceeding,” a more reserved judgment than in April, when it said economic activity continued to “strengthen.” The Fed also said the labor market is “improving gradually.”

Without a doubt, the initial jobless claims numbers in 2010 look a lot better than in 2009.  But job losses are cumulative, and the jobs lost in 2009 are still lost today.  Until we start seeing week-on-week drops in initial jobless claims that get closer to that 325,000 floor, we won’t see enough job creation to just keep pace with population growth, let alone start to make up the losses from the past two years.  The Fed’s implicit warning on growth should serve as a hint to media outlets not to consider further bad news down the road “unexpected.”