US unemployment claims rise

New applications for weekly US unemployment benefits jumped last week, the Labor Department reported Thursday, rising to a six-week high of 399,000 in the week ending Jan. 7, a 24,000 increase on the previous week’s total of 375,000.

The figure was higher than economists had expected, but some downplayed the spike, saying that such an increase is typical in early January due to companies laying off thousands of temporary workers hired to help during the holiday season, the Associated Press reported.

According to CNN Money, the figure is uncomfortably close to the 400,000 level at which economists claim substantially lowering the unemployment rate becomes too difficult.

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Jobless claims can be volatile around this time of year, Bloomberg reported, as the Labor Department has trouble adjusting its data to take seasonal swings in employment into account.

The leap follows three weeks of steady decline which saw initial jobless claims fall to their lowest level in more than three years.

More than 4 million Americans currently get unemployment benefits every week, down from around 4.8 million a year ago, according to AFP.

The news agency quoted Steven Ricchiuto, chief economist at Mizuho Bank, as saying that the figures pointed to an economy that was “muddling through.”

"The sharp increase in claims following the end of the holiday season suggests that temporary employment was the driver behind the recent improvement in labor market conditions," he said.

Michigan and Wisconsin both saw large increases, while claims in California dropped substantially.

Elsewhere, Reuters reported that total retail sales rose at the weakest pace in seven months in December, increasing 0.1%, according to the Commerce Department.

November’s upwardly revised figure of 0.4% suggests that consumers probably frontloaded their holiday season shopping before cutting back on spending at the end of year.

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