The Associated Press attempts to spin this as good news because it’s lower than before, but by the second paragraph even the lefty wire service has to acknowledge reality. Fact is, 457,000 new jobless claims were filed last week.

WASHINGTON – The tally of newly laid-off workers seeking unemployment benefits fell unexpectedly for the fifth straight week, a hopeful sign that the job market is slowly improving.

Still, claims remain above the levels that most analysts say would be consistent with an economy that is adding jobs. The unemployment rate is at 10.2 percent and expected to keep climbing into next year.

And, as we already know, the real unemployment rate is about 17.5%. The above unemployment rate also doesn’t include individuals who’ve simply stopped searching for new employment, having lost all hope.

But we’re getting better, right? Not so fast. The Thanksgiving holiday was a contributor to the lower number.

A Labor Department analyst said the closing of state unemployment offices for last week’s Thanksgiving holiday was responsible for some of the decline.

So, at least part of the fall wasn’t due to fewer jobs being lost but rather the employment offices being closed and unable to report the losses. That’s not promising. And it only gets worse:

Meanwhile, the number of people claiming unemployment benefits for more than a week rose by 28,000 to 5.5 million, the department said. Analysts had expected a decline.

As we’ve already covered here, the extended unemployment benefits are largely to blame. Keeping people on the government’s dole discourages a search for new employment. And the benefits are actually costing small businesses:

As if small businesses needed another reason not to hire, consider their latest financial burden: The cost of rising unemployment itself.

Employers already are squeezed by tight credit, rising health care costs, wary consumers and a higher minimum wage. Now, the surging jobless rate is imposing another cost. It’s forcing higher state taxes on companies to pay for unemployment insurance claims.

Some employers say the extra costs make them less likely to hire. That could be a worrisome sign for the economic recovery, because small businesses create about 60 percent of new jobs. Other employers say they’ll cut or freeze pay…

But the severity of this recession has bankrupted many states’ trust funds and forced them to borrow from the federal government. States eventually must pay back the loans. Otherwise, the federal government can raise taxes on their businesses.

Incidentally, we’re now in the 22nd straight month of job losses. It’ll be two straight years by January.