U.S. Weekly Jobless Claims Climb To Highest Level Since August

(RTTNews) - First-time claims for U.S. unemployment benefits rose by much more than expected in the week ended May 4th, according to a report released by the Labor Department on Thursday.

The report said initial jobless claims climbed to 231,000, an increase of 22,000 from the previous week's revised level of 209,000.

Economists had expected jobless claims to inch up to 210,000 from the 208,000 originally reported for the previous week.

With the much bigger than expected increase, jobless claims reached their highest level since hitting 234,000 in week ended August 26th.

"If the higher level of claims persists or if claims rise further, it would be a sign of a further loosening in labor market conditions," said Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics.

She added, "However, one week of data doesn't change our call for the Fed to keep interest rates at current levels until September."

The Labor Department said the less volatile four-week moving average also crept up to 215,000, an increase of 4,750 from the previous week's revised average of 210,250.

Continuing claims, a reading on the number of people receiving ongoing unemployment assistance, also rose by 17,000 to 1.785 million in the week ended April 27th.

However, the four-week moving average of continuing claims dipped to 1,781,000, a decrease of 6,250 from the previous week's revised average of 1,787,250.

The Labor Department released a separate report last Friday showing employment in the U.S. increased by much less than expected in the month of April.

The Labor Department said non-farm payroll employment climbed by 175,000 jobs in April after surging by an upwardly revised 315,000 jobs in March.

Economists had expected employment to jump by 243,000 jobs compared to the spike of 303,000 jobs originally reported for the previous month.

The report also showed the unemployment rate crept up to 3.9 percent in April from 3.8 percent in March. The unemployment rate was expected to remain unchanged.