WASHINGTON (AP) _ Applications for unemployment benefits dropped to a five-month low early this month, the government said Thursday, in a sign the economic recovery is spreading to the politically all-important jobs market.

Americans filed 415,000 first-time unemployment insurance claims during the week ended April 4, a drop of 18,000 from the previous week and the lowest number since the week ending Oct. 26.

It was the second consecutive significant decline and was greeted by Labor Secretary Lynn Martin as ''further confirmation of a strengthening labor market and economy.''

Americans filed 433,000 claims during the previous week and 456,000 two weeks earlier.

A less volatile four-week moving average of claims also is headed down. It was 427,750 for the most recent four-week period, the lowest average since early November and down from 442,000 a week earlier and 448,750 two weeks earlier.

Economists said the back-to-back drop is one of the first signs the economic recovery is spreading to the jobs market, but they cautioned that much ground remains to be regained after nearly two years of job losses.

The unemployment rate was stuck at a 6 1/2 -year high of 7.3 percent in March and will only gradually improve over the rest of the year, economists predicted.

''Jobless claims are moving in the right direction. From an economic point of view, that's certainly good news,'' said economist Mark Zandi of Regional Financial Associates Inc. in West Chester, Pa.

''But, clearly the job market is weak by historical standards. The best you can say is it's stabilized and politically the administration is trying to paint stabilization as a positive factor,'' he said.

Martin said, ''The administration is not satisfied with just a stabilized labor market. We will not rest until we have restored strong job growth and new job creation to the economy.''

Typically, the job market is one of the last sectors of the economy to show noticeable improvement in the early stages of recoveries. Employers often ask existing workers to put in overtime. Then, if an economic upturn looks like it will endure, they hire more workers.

''It looks as if we've reached a point where at least there's modest employment growth,'' said economist Robert G. Dederick of Northern Trust Co. in Chicago. ''... It seems to me we have rounded the bend and are now on the recovery path. The only real issue now is how fast and how far.''

Pennsylvania reported the biggest decline in layoffs, 2,691, attributing the drop to fewer job losses in construction and service industries.

California had the biggest increase in first-time claims, 5,287, followed by Florida, 4,444, and Illinois, 2,003. California officials mentioned layoffs in electronics, food processing and agriculture. Florida and Illinois cited trade, services and manufacturing. Florida also cited construction job losses.

The national claims number is adjusted for seasonal fluctuations. The state figures are not.