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New jobless claims rise more than expected

March 13, 2009|Associated Press

WASHINGTON — With layoffs spreading, the number of initial claims for jobless benefits rose last week, while the total number of people continuing to receive benefits set a record high, the government said Thursday.

The Labor Department reported that first-time requests for unemployment insurance rose to 654,000 from the previous week's upwardly revised figure of 645,000, above analysts' expectations.

The number of people receiving benefits for more than a week increased by 193,000 to 5.3 million, the most on records dating to 1967. That's the sixth time in the last seven weeks that the jobless claims rolls have set a record high.

The labor market has been hammered as employers, squeezed by cutbacks in consumer and business spending, shed jobs at a rapid pace. Some economists say the U.S. unemployment rate could reach 10% by the end of this year, from its current level of 8.1%.

The four-week average of new claims, which smooths out fluctuations, rose to 650,000, the most in more than 26 years, though the workforce has grown by about half since then.

As a proportion of the workforce, the tally of Americans receiving unemployment benefits is the highest since June 1983, the department said.

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