The U.S. jobs market is on fire, if Thursday's jobless claims report is the best guide.

The report showed that for the week ending July 18, there were just 255,000 first-time claims for unemployment benefits throughout the 50 states.

The last time unemployment benefit claims were that low was November 1973, near the peak of the business cycle.

At the time, during President Richard Nixon's administration, the economy was just leaving a cyclical peak and entering a recession, according to the National Bureau of Economic Research. The unemployment rate was 4.8 percent, compared with the current 5.3 percent.

And there was a much smaller pool of workers who might need to rely on unemployment benefits. The size of the workforce insured for unemployment was 62 million, less than half the 134 million today.

Thursday's claims, and the long-running 2015 trend of falling claims, is one sign that there is little "slack" left in labor markets, a development that would have significant consequences for U.S. policy. In particular, it would mean that the Federal Reserve, and Chairwoman Janet Yellen, set to meet to discuss monetary policy next week, are wrong in their assessment that the jobs market hasn't fully recovered from the recession and that they should act quickly to raise interest rates.

But there are some reasons to discount Thursday's rosy jobless claims report.

One, raised by economists at Deutsche Bank, is that the sudden drop in jobless claims could reflect "payback" for the nearly 300,000 claims filed during the week of July 4. In other words, the result might have been a reflection of that fact that jobless claims are "notoriously volatile around holidays."

Another factor cited by some analysts is that auto companies typically shut down some factories in July for maintenance, a tricky seasonal variation for the Department of Labor to try to smooth out.

The Labor Department said there were no special circumstances affecting the number of claims.

Nevertheless, the overall trend is clearly toward decades-low claims.

"This week's claims reading may have been exaggerated on the low side but there is certainly no sign of the labor market losing momentum," Jim O'Sullivan, chief economist at the forecasting firm High Frequency Economics, said in a note on the report.

Deutsche Bank predicted, based on Thursday's report, that the unemployment rate would fall to 4.7 percent by the end of the year, well below the 5.2 percent to 5.3 percent Fed officials expect.

Unemployment claims and layoffs are only one part of the equation. As they have scraped decades-lows, hiring has not kept up. There were 5 million hires in May, according to the Bureau of Labor Statistics, below the pre-recession highs of 5.4 million-plus and well below the 5.8 million high since the bureau began tracking the numbers.

Yellen has said that she is watching hires, quits and the number of part-time unemployed, among other indicators, as signs of the labor market's health. The number of people forced into part-time labor or barely looking for a job is still high relative to normal times.