RJ and Makay

Here's the sort of good news about the job market we've heard a lot over past couple months. Last week, new applications for state unemployment benefits fell by 16,000 to 385,000. The decline beat the predictions of economists, who thought initial jobless claims would drop to a seasonally adjusted 389,000 in the week ended March 12.

Furthermore, first-time claims for unemployment benefits averaged 386,250 in the past four weeks — the lowest level since July 2008. The four-week average is a more accurate measure of employment trends because it smoothes out weekly variation in jobless claims data.

The outlook at small U.S. companies is more positive than it's been in several years. In February, the National Federation of Independent Business (NFIB) index of small company optimism rose to 94.5 — its highest level since December 2007. The index also isn't terribly far off the average of 100.7 it posted during the previous expansion that began in November 2001.

“The future is looking brighter for a few more small-business owners,” comments William Dunkelberg, NFIB chief economist. Still, he notes, “this is not a reading that characterizes a strongly rebounding economy.”

No one's promising a rose garden, but economists do seem increasingly optimistic. According to a Reuters poll released today, the consensus for 2011 among 80 economists surveyed is for overall GDP growth of 3%, up from the 2.7% forecasted in December and the 2.3% predicted in November.

Growth expectations for the first and second quarters of 2011 also rose dramatically, to 3.2% from 2.7% and 2.8%, respectively, in last month's poll. "The upgrade in view has been due to better data, more fiscal stimulus in 2011 than we had expected — particularly the payroll tax cut which was not anticipated — and analysis that suggested households have now increased saving," says Goldman Sachs economist Andrew Tilton.