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Thursday, May 5, 2011

Jobless claims spike to highest level in eight months, the Labor Department reports

NEW YORK - APRIL 02:  People wait on line to s...Image by Getty Images 
New U.S. claims for unemployment aid unexpectedly rose last week to highest level in eight months. Claims were pushed up by factors ranging from spring break layoffs to the introduction of an emergency benefits program, a government report showed on Thursday.

Initial claims for state unemployment benefits rose 43,000 to a seasonally adjusted 474,000, the highest since mid-August, the US Department of Labor stated on May 5th. 

The four-week moving average of unemployment claims, a better measure of underlying trends, increased 22,250 to 431,250, the highest since November. Hiring slowdown is mostly blamed on high food and gasoline prices, which clipped economic growth in the first quarter.

A Labor Department official attributed the surprise surge in claims last week to spring break layoffs in New York, which added 25,000, and the start of an emergency benefits program in Oregon, which brought in new claimants, including some already on the regular programs.

There were also additional claims from the auto sector, the official said, adding that there could have been some small claims related to the tornadoes that struck parts of the country. However, he said such claims would normally go into a parallel program.
"The increases are beyond what seasonal factors expected and that is causing claims to go up," an spokesman from the Labor Department stated.
The number of people still receiving benefits under regular state programs after an initial week of aid increased 74,000 to 3.73 million in the week ended April 23. Economists had expected so-called continuing claims to edge up to 3.65 million from a previously reported 3.64 million.

The number of people on emergency unemployment benefits dipped 718 to 3.45 million in the week ended April 16, the latest week for which data is available. A total of 8.01 million people were claiming unemployment benefits during that period under all programs.

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