Jobless claims drop to 260,000, suggesting economy is dodging worst of omicron

The number of new applications for unemployment benefits fell 30,000 last week to 260,000, in line with expectations and a sign that the omicron variant's damage to the labor market is limited.

The jobless claims numbers reported on Thursday morning by the Labor Department suggest that layoffs have risen in recent weeks as the omicron variant spread through the country.

Claims rose higher earlier in January but now appeared headed back down to the very low levels seen in the fall, suggesting that employers are still desperate to hold on to labor.

"The first...