The number of Americans filing for unemployment benefits rose more than expected last week, posting the biggest gain in more than a year, but the underlying trend continued to point to a strengthening labor market.
Initial claims for state unemployment benefits increased 17,000 to a seasonally adjusted 274,000 for the week ended April 30, the Labor Department said on Thursday. Last week's increase was the largest since February of last year.
Claims for the prior week were unrevised. Economists polled by Reuters had forecast initial claims rising to 260,000 in the latest week. Jobless claims have now been below 300,000, a threshold associated with healthy labor market conditions, for 61 consecutive weeks, the longest stretch since 1973.
A Labor Department analyst said there were no special factors influencing last week's claims data and only claims for the District of Columbia had been estimated.
The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, rose 2,000 to 258,000 last week.
The latest claims data has no bearing on April's employment report as it falls outside the survey period.
Claims were generally low in April compared to March. That points to a fairly robust labor market despite a report on Wednesday showing hiring by employers in the private sector last month was the weakest in three years.
Though the ADP National Employment Report showed a slowdown in services industry hiring last month, an Institute for Supply Management survey showed employment in the services sector increased in April for a second straight month.
According to a Reuters survey of economists, the Labor Department is expected to report on Friday that nonfarm payrolls increased by 202,000 jobs in April after a gain of 215,000 in March. The unemployment rate is seen hold steady at 5.0 percent and average hourly earnings are forecast rising 0.3 percent for a second consecutive month.
Thursday's claims report showed the number of people still receiving benefits after an initial week of aid fell 8,000 to 2.12 million in the week ended April 23, the lowest level since November 2000.
The four-week average of the so-called continuing claims declined 17,000 to 2.14 million, also the lowest reading since November 2000.