US unemployment claims at highest level since March

First-time claims for US unemployment benefits rose for the second consecutive week last week, hitting a nine-month high during the year-end holiday season, government data released Thursday showed.

The Labor Department released a report on Thursday showing that initial jobless claims climbed to 379,000, an increase of 10,000 from the previous week’s figure of 369,000.

The modest increase came as a surprise to economists, who had expected jobless claims to drop to 337,000 from the 368,000 originally reported for the previous week.

With the unexpected increase, jobless claims climbed further off the nearly three-month low set in the last week of November and reached their highest level since late March.

Mei Li, Economic Analyst at FTN Financial, said, “Initial jobless claims bounced back to a level higher than that of October, when computer systems upgrades caused underreporting and a backlog that came on all at once.”

“The rise was likely due to year-end holiday seasonal layoffs, which the BLS struggles to adjust properly at this time of year,” she added. “Nevertheless, claims will have to be watched closely in coming weeks. If the rise does not quickly reverse it will be a sign there is more going on.”

The report said the less volatile four-week moving average rose to 343,500, an increase of 13,250 from the previous week’s revised average of 330,250.

Continuing claims, a reading on the number of people receiving ongoing unemployment assistance, also jumped to 2.884 million in the week ended December 7th from the preceding week’s revised level of 2.790 million.

The four-week moving average of continuing claims edged up to 2,799,000, an increase of 4,250 from the preceding week’s revised average of 2,794,750. RTT News