The number of Americans filing new claims for unemployment benefits climbed again in the latest week, in another indication of deepening economic woes after the Sept. 11 attacks, the Labor Department announced on Thursday.

And in a sign workers are staying jobless, continued claims for state unemployment benefits for the week ended Oct. 13 -- the most recent week for which the data were available -- rose to the highest level in more than 18 years, climbing 56,000 to 3.65 million. 

The Labor Department said the number of initial jobless claims increased by 8,000 to a seasonally adjusted 504,000 for the week ended Oct 20. This was above Wall Street's expectations of 497,000. 

The four-week moving average of initial claims, considered a more reliable measure of employment conditions than the weekly data because it irons out fluctuations, climbed 12,000 to 505,000, a level unseen since March 1991, at the tail end of the last U.S. recession. 

In a separate report, the Commerce Department said U.S. durable goods plunged 8.5 percent in September, the fourth straight month of decline, providing more evidence the Sept. 11 attacks have taken a heavy toll on the economy. 

``Clearly all of the numbers put together confirm the overall economic environment is becoming quite dismal,'' Anthony Karydakis, senior financial economist at Banc One Capital Markets in Chicago, said. 

However, boosted by rising health insurance costs, the compensation of U.S. workers rose in the third quarter, Labor said in a separate report. 

Labor said its Employment Cost Index, a broad gauge of what employers pay in wages, salaries and benefits, rose 1.0 percent for the three months ended September. That was up from a 0.9 percent rise in the second quarter and higher than the 0.9 percent rise economists were expecting.

Reuters and the Associated Press contributed to this report.