The number of people seeking unemployment benefits in the U.S. rose from 68,000 last week to a seasonally adjusted 368,000, the largest increase in more than a year, the Associated Press reported.
The rise in first-time applications could be a distressing sign if it lasts. But it could likely reflect the difficulty of adjusting for delays after the Thanksgiving holiday. Getting close to pre-recession levels and generally a positive sign for job gains, the Labor Department said Thursday that the less volatile four-week average rose 6,000 to 328,750.
According to the AP, applications tumbled in recent weeks to nearly six-year lows, partly because of a late Thanksgiving holiday that may have distorted the government's seasonal adjustments. Economists believe this week's jump in claims was a dose of payback.
"What the seasonals give in one month they have to take back the next, hence today's number," said Ian Shepherdson, chief economist at Pantheon Macroeconomics, according to the AP.
According to the AP, layoffs are an alternative for unemployment application aids. A steady decline over the past year suggests fewer Americans have lost their jobs. Economists will track the next few weeks closely to see if that trend is reversing, or if the surge is a temporary blip caused by seasonal adjustments.
The recent drop in layoffs has coincided with a pickup in hiring. An average of 204,000 jobs a month from August through November, up from an average of 146,000 in May through July have been added to the economy, Reuters reported.
Employers added 203,000 jobs last month and the unemployment rate dropped to a five-year low of 7 percent, the government said Friday. Four straight months of robust hiring have raised hopes that 2014 will be the year the economy returns to normal, Reuters reported.
A healthier job market could make the Federal Reserve go back to its extraordinary economic stimulus programs. The Fed has been buying $85 billion in bonds each month to keep long-term interest rates low and encourage borrowing and spending.
More than 3.8 million people collected some form of unemployment benefits in the last full week of November, Reuters reported. However, 1.25 million of them could soon lose those benefits. They received aid under a special federal program for the long-term unemployed that is set to expire on Dec. 28.
According to Reuters, the program extends aid that usually expires after six months for an additional 28 weeks. Congressional leaders have proposed a budget deal that would not preserve the additional benefits, meaning that as many as 2.1 million Americans will lose this assistance by March.
