First-time claims for unemployment benefits fall to 7-year low

NEW YORK (CNNMoney) -- First-time claims for unemployment benefits suddenly fell to the lowest level since early 2006, but don't break out the champagne just yet.

About 292,000 people filed initial claims for unemployment benefits in the week ending September 7, the Labor Department reported Thursday morning. That's a dramatic 31,000 drop to the lowest level since April 2006.

However, the Labor Department noted that two states reported incomplete results, possibly due to complications as they updated their computer systems. Once those states submit their final data, the total is likely to be revised higher in the next few weeks.

"Take a grain of salt and call me next Thursday," noted Jonathan Basile, director of U.S. Economics at Credit Suisse, in a report to clients.

The 4-week moving average, which smooths out some of the volatility, fell to 321,250.

Claims had already been hovering around their lowest levels since 2008. Over the past few months, economists have taken this data as an encouraging sign that layoffs are back to normal levels. However, other evidence shows that hiring for new jobs has not picked up too quickly.

There were 3.7 million job openings in July -- about one opening for every 3 unemployed people.

"The underlying story in jobless claims is one of a continued improvement," said Yelena Shulyatyeva, a market economist at BNP Paribas. "However, as we continue to highlight, claims have not provided the best read on overall labor market conditions since they only capture the pace of firing and not what is happening on the hiring front."

As of August, 11.3 million Americans remained unemployed. And according to the most recent data, nearly 3 million continued to file for their second week or more of unemployment benefits.