NEW YORK (CNNMoney) -- Claims for unemployment benefits fell sharply last week to their lowest level in more than four years, but the drop was due mostly to a technical issue.
About 339,000 people filed for first-time unemployment benefits in the week ended October 6, down 30,000 from the previous week, the Labor Department said Thursday.
That's a dramatic drop in just one week and represents the lowest level of initial claim filings since February 2008.
The weekly claims figure is often seen as a proxy for layoffs, so when it drops, it's considered an encouraging sign that the job market is improving. But the figure is extremely volatile and has failed to hold a consistent trend this year.
Much of the drop last week was caused by an anomaly, a Labor Department analyst told CNNMoney. One state posted a large decline in claims, which is not typical during the last week in September.
Usually, most states report a rise in initial claims at the end of the quarter. The Labor Department seasonally adjusts its figures to account for those trends, but this year the rise was smaller than expected because of that state.
Many economists speculated that the state is California, but the Labor Department will not confirm that until it publishes its state breakdown next week.
"It was likely a state with a large population and we suspect that it was California based on the occasional massive swings that have occurred in its claims data in the past," said Daniel Silver, economist at JPMorgan, in a note to clients.
The Labor Department publishes the state breakdown with a lag, so next week's report will shed more light on the issue.
The latest jobless claims figures come less than a week after a strong monthly jobs report raised eyebrows and unleashed a political firestorm, with former GE CEO Jack Welch alleging that the numbers were manipulated. There's no evidence of any misconduct and Labor Secretary Hilda Solis has called the conspiracy theories "insulting."
The report showed the unemployment rate fell to 7.8% in September, the lowest rate since President Obama was inaugurated in January 2009.