U.S. jobless claims rise for 1st time in 3 weeks

The number of Americans claiming jobless benefits jumped more than expected in the latest period, the first negative week in three for this well-watched economic indicator.

Almost 525,000 Americans asked for employment insurance across U.S. for the week ended Jan. 10, a hike of 54,000 in the period. Economists had expected a rise, but only to 501,000.

Jobless claims, an indication of the number of Americans who think they might be unemployed for awhile, had dropped in the previous two weeks, 470,000 on Jan. 3 and 491,000 for the five days ended Dec. 27.

At 317,000, employment insurance claims for the Jan. 10 week in 2008 were 40 per cent lower than in the latest period.

Jobless insurance claims (000s) 1 week 4-week averageWeek of Jan. 10 524 518.50Week of Jan. 3470 526.50Week of Dec. 27 491 552.75 Source: U.S. Labour Department

The number of jobless claims generally moves in line with the change in the country's employment and unemployment rates. Because the insurance claims are released before the jobs figures, however, analysts often use the initial claims number to predict the national unemployment rate.

But while headlines focus on the weekly number, the recent volatility in jobless claims shows why economists tend to watch the four-week moving average of initial jobless claims more than the one-week figures.

Mixing in the latest week's 524,000 claims with the previous three weeks resulted in a month average of 518,500 — a drop of 8,000 claims from the previous four-week average of 526,500.