WASHINGTON – New claims for jobless benefits moved higher last week, a possible sign that employers haven't completely let go of their caution and are looking to cut costs.
The Labor Department (search) reported Thursday that the number of new applications filed for unemployment insurance (search) rose by a seasonally adjusted 8,000 to 357,000 for the week ending Dec. 4. That marked the highest level since late September.
Last week's increase followed a sharp rise in claims — of 25,000 — in the prior week.
The newest snapshot of labor market activity was a bit disappointing to economists. They were forecasting claims to drop to around 335,000 for last week.
Higher energy bills and expensive health-care costs may be taking their toll on some companies — squeezing profits and forcing them to trim workers.
New claims have gone up for two straight weeks. A Labor Department analyst said some of the rise may reflect seasonal adjustment difficulties surrounding the Thanksgiving Day holiday.
The economy added a net 112,000 jobs in November, considerably fewer jobs than analysts had expected and a deceleration from the 303,000 positions added in October, the government reported last week.
Strengthening job creation has been an important task for President Bush. The still-recovering job market has been seized upon by Democrats who contend the president's economic policies have failed to induce a steady hiring spree by businesses.
The number of unemployed people continuing to collect jobless benefits rose by 91,000 to nearly 2.8 million for the week ending Nov. 27, the most recent period for which that information is available. That was the highest level since the end of October.
Still, analysts are hopeful that slowing productivity growth will eventually result in businesses hiring workers to meet customer demand. The notion is that existing workers — who have powered efficiency gains — may finally be stretched too thin.
The Federal Reserve (search), wanting to keep inflation from becoming a danger, is expected to boost short-term interest rates for a fifth time this year on Dec. 14. Economists believe rates will be bumped up by another one-quarter percentage point, which would leave a key rate at 2.25 percent.