WASHINGTON (AP) -- A drop in new jobless claims came in short of expectations and factory orders rose only slightly, fresh evidence the economy is recovering at a slow, uneven pace.
The Labor Department said today that first-time jobless claims dropped by 8,000 to a seasonally adjusted 470,000. Analysts had expected a steeper drop to 450,000, according to Thomson Reuters.
The four-week average, which smooths out volatility, rose for the second straight week to 456,250. The average had fallen for 19 straight weeks before starting to rise.
Two weeks ago, claims surged by 34,000 due to administrative backlogs left over from the holidays in the state agencies that process the claims, a Labor Department analyst said. Those delays may still be affecting the data, the analyst said.
That means the current figures could be artificially inflated. At the same time, it would also mean that the steep drop in claims in late December and early January was also exaggerated by the backlogs.
Economists closely watch initial claims, which are considered a gauge of the pace of layoffs and an indication of companies' willingness to hire new workers.
Separately, orders to U.S. factories for big-ticket manufactured goods rose 0.3 percent in December, much less than the 2 percent advance economists had been expecting.
For all of 2009, durable goods orders plunged by 20.2 percent, the largest drop on records that go back to 1992.
The decline highlighted the battering that U.S. manufacturers have suffered during the recession. Economists are hoping that improving outlooks in the U.S. and globally will make 2010 a better year for U.S. manufacturers.
The data comes after President Barack Obama spent most of Wednesday's State of the Union address focused on the economy and jobs.
Obama called on Congress to enact a second stimulus package "without delay," urging that it contain help for small businesses and funding for infrastructure projects.
The Federal Reserve, meanwhile, said Wednesday "the deterioration in the labor market is abating."
Still, the Fed kept the short-term interest rate it controls at a record-low level of nearly zero, and pledged to keep it there for "an extended period."
Jobless claims, meanwhile, have dropped since last fall, as companies cut fewer jobs. In late December, initial claims fell to their lowest level since July 2008, before the financial crisis intensified that September.
Despite the downward trend over the winter, the economy is not yet consistently generating net increases in jobs. The Labor Department said earlier this month that employers cut 85,000 jobs in December, after adding 4,000 in November. November's small increase was the first in nearly two years. The unemployment rate was unchanged at 10 percent.
The number of people continuing to claim benefits, meanwhile, dropped by 57,000 to 4.6 million. Those figures lag initial claims by a week.
But the so-called continuing claims do not include millions of people who have used up the regular 26 weeks of benefits typically provided by states, and are receiving extended benefits for up to 73 additional weeks, paid for by the federal government.
More than 5.6 million people were receiving extended benefits in the week ended Jan. 9, the latest data available. That's about 300,000 fewer than the previous week. All told, more than 10 million people are receiving unemployment assistance.
Some employers are continuing to cut jobs. Home Depot Inc. said Tuesday that it will lay off 1,000 employees. And Wal-Mart Stores Inc. said it will cut 11,200 jobs in its Sam's Club stores as it outsources product demonstrations.