Jobless claims fall to five-year low

The improvement could be the result of holiday adjustments. Unadjusted claims usually hit their highest level of the year in mid-January as temporary workers get laid off. But those seasonal layoffs were smaller than expected, according to a government official.

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Economists argue that the labor market is healthier when applications fall below 375,000, with a hiring pace that is fast enough to bring down the unemployment rate, which now sits at 7.8 percent. 

Jobs gains averaged more than 150,000 a month last year and the overall unemployment rate fell from 8.3 percent. Still, about 12 million people remain unemployed, leaving plenty of room for improvement in the job market. 

Employers added 155,000 jobs last month, reflecting a job market that wasn't hampered by the "fiscal cliff" talks that took until New Year's Day to reach fruition. 

Economists have warned, though, that while businesses didn't hold back hiring through the tax and spending talks, job growth may not pick up pace until Congress has dealt with raising the $16.4 trillion debt limit, found a way to pay for the final 10 months of scheduled spending cuts and completed an omnibus bill that would keep the government running from April through September once a stopgap expires at the end of March.