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By Luca Di Leo and Sarah N. Lynch New York Post
The number of U.S. workers making new claims for jobless benefits unexpectedly rose last week to the highest level in nine months, the Labor Department said in its weekly report Thursday -- a distressing sign for an already weak labor market.
Initial unemployment claims rose by 12,000 to 500,000 in the week ended Aug. 14. It was the highest level since Nov. 14, when claims stood at 509,000.
Economists surveyed by Dow Jones Newswires predicted filings would decline by 4,000.
The four-week moving average, which aims to smooth volatility in the data, rose by 8,000 to 482,500. It was the highest level since December 2009. New claims for the previous week, ending Aug. 7, were revised up to 488,000 from the originally reported 484,000.
The rise in claims was particularly troubling because analysts had been expecting an improvement for some time. They said recent data was likely distorted by seasonal adjustment factors tied to factory shutdowns by carmakers and the hiring and firing of temporary workers for the 2010 Census.
The level of new claims fell steadily from a high of 651,000 in March 2009 to a low of 439,000 in early February. Since then, however, it crept back up, and the latest rise to 500,000 was particularly worrying.
U.S. labor conditions already looked poor. The economy lost 131,000 jobs in July, and the unemployment rate stayed at a high 9.5 percent. After its policy-setting meeting last week, the Federal Reserve noted that the recovery in the jobs market slowed. The central bank decided to prevent its balance sheet from shrinking to counter the slowdown in the economy.
In the Labor Department's claims report Thursday, the number of continuing claims -- those drawn by workers for more than one week in the week ended Aug. 7 -- fell by 13,000 to 4,478,000 from the preceding week's revised level of 4,491,000. The previous estimate was 4,452,000. Continuing claims are reported with a one-week lag.
The unemployment rate for workers with unemployment insurance for the week ended Aug. 7 was 3.5 percent, unchanged from the prior week.
The report also has a state-by-state breakdown of new claims for the week ended Aug. 7, when there was another troubling increase.
The largest increase in claims occurred in California, which saw a rise of 4,393 due to layoffs in the service industry. The largest decrease in claims took place in Wisconsin, which saw a fall of 1,873. No additional details were provided for Wisconsin.
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