WASHINGTON - More Americans unexpectedly filed first-time claims for unemployment insurance last week, indicating companies lack confidence the economic recovery will be sustained.
Initial jobless applications increased to 480,000 in the week ended Jan. 30, the most in seven weeks, from 472,000 the prior week, Labor Department figures showed Thursday in Washington. The number of people receiving unemployment insurance was little changed, and those receiving extended benefits increased.
An unemployment rate that's projected to average 10 percent this year will likely weigh on consumer spending, preventing the biggest part of the economy from accelerating. Without additional gains in sales, companies will be forced to keep cutting costs and limiting staff to boost profits.
"The pace of improvement has slowed significantly in the last two months," said Anna Piretti, a senior economist at BNP Paribas in New York. "This points to downside risk for consumption and the rest of the economy." Initial jobless claims were forecast to decline to 455,000 from 470,000 the week before, according to the median estimate of 46 economists surveyed by Bloomberg News. The four-week moving average of claims increased to 468,750 from 457,000 the prior week.
Continuing claims were little changed at 4.6 million in the week ended Jan. 23. The continuing claims figure does not include the number of Americans receiving extended benefits under federal programs.
The number of people who've used up their traditional benefits and are now collecting extended payments increased by about 242,000 to 5.86 million in the week ended Jan. 16.
- Bloomberg News