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US jobless claims rise 20,000 last week

Published 11/04/2010, 08:32 AM
Updated 11/04/2010, 08:40 AM

WASHINGTON, Nov 4 (Reuters) - New U.S. claims for unemployment benefits rose more than expected last week, government data showed on Thursday, underlining the persistent weakness in the labor market.

Initial claims for state unemployment benefits increased 20,000 to a seasonally adjusted 457,000, the Labor Department said, reversing the prior week's decline.

Analysts polled by Reuters had forecast claims rising to 443,000 from the previously reported 434,000. The government revised the prior week's figure up to 437,000.

The report came a day after the Federal Reserve announced it would buy an additional $600 billion worth government bonds by the middle of next year to spur the lackluster economic recovery and boost employment.

The second round of asset purchases is intended to push interest rates further down, thereby stimulating domestic demand and prevent the current low inflation environment from spiraling into a damaging bout of deflation.

The claims data has little influence on October's employment report due on Friday as it falls outside the survey period. The government is expected to report that nonfarm payrolls increased 60,000 last month, likely the first expansion since May, after dropping 95,000 in September, according to a Reuters survey.

A Labor Department official said there was nothing unusual in the claims data and described the report as fairly clean.

Last week, the four-week average of new jobless claims, considered a better measure of underlying labor market trends, rose 2,000 to 456,000.

The number of people still receiving benefits after an initial week of aid fell 42,000 to 4.34 million in the week ended Oct. 23, the lowest level since the week ending Nov. 22, 2008. The prior week's figure was revised up to 4.38 million.

Analysts polled by Reuters had forecast so-called continuing claims rising to 4.38 million from a previously reported 4.36 million.

The number of people on emergency benefits increased 198,579 to 3.98 million in the week ended Oct. 16. (Reporting by Lucia Mutikani; Editing by Andrea Ricci)

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