WASHINGTON (AP) -- The number of people seeking unemployment benefits rose last week to a seasonally adjusted 377,000, after a nearly four-year low the previous week.
The Labor Department said Thursday that weekly applications increased 21,000. Applications had plummeted two weeks ago to their lowest level since April 2008. The four week average, a less volatile measure, is down to 377,500.
Applications have trended downward over the past few months. The average has fallen about 9 percent since Oct. 1.
Unemployment applications have been particularly volatile this month because employers have cut temporary workers hired for the holidays. The department adjusts for seasonal trends. But doing so accurately can be difficult.
Applications generally need to fall consistently below 375,000 to signal that hiring is strong enough to lower the unemployment rate.
The long-term trend is pointing to a healthier job market.
Hiring improved in the second half of last year. In December, employers added 200,000 jobs, and the unemployment rate fell to 8.5 percent -- the lowest level in nearly three years.
Economists forecast that the nation will gain about 160,000 jobs per month in 2012, according to a survey of economists by the Associated Press. That's up from an average of about 135,000 last year.
A better outlook for job growth has coincided with other signs of improvement in the economy. Factory output jumped in December and consumer confidence and spending have risen. Even the battered housing market has shown some signs of slight improvement.
Still, the Federal Reserve said Wednesday that it expects growth to remain modest this year. And it forecasts only gradual declines the unemployment rate.
The Fed predicts the unemployment rate could fall as low as 8.2 percent by the end of 2012. The economy will likely expand about 2.5 percent this year.
The job market has a long way to go before it fully recovers from the damage of the Great Recession, which wiped out 8.7 million jobs. More than 13 million people remain unemployed. Millions more have given up looking for work and so are no longer counted as unemployed.
Growth could slow this year. Europe is almost certain to fall into recession because of its financial troubles. And wages aren't keeping up with inflation. That makes it harder for consumers to spend more, potentially limiting growth.