(Adds details, market reaction)
WASHINGTON, April 2 The number of U.S. workers
filing new claims for jobless benefits surged to a nearly
26-1/2 year high last week, data showed on Thursday, indicating
that the pace of job losses was yet to peak.
At the same time, the number of laid-off workers collecting
state unemployment benefits jumped to a record high in March,
the Labor Department said, as the recession now in its 16th
month makes it tough to find a new job.
New applications for state jobless insurance benefits rose
12,000 to a seasonally adjusted 669,000 in the week ended March
28, the highest since the week ending Oct. 2, 1982, from an
upwardly revised 657,000 the week before.
Analysts polled by Reuters had forecast 650,000 new claims
versus a previously reported count of 652,000 the prior week.
U.S. stock index futures pared gains after the data, while
government bond prices held steady at lower levels.
"We have been seeing not just an elevated trend but an
increasing trend. That is not good. We know the labor market is
going to be a lagging indicator, but we need to see the pace of
job losses moderate soon if we are going to get a recovery,"
said Scott Brown, chief economist at Raymond James & Associates
in St. Petersburg, Florida.
Highlighting the difficulties of getting a new job, the
number of people staying on the benefits roll after collecting
an initial week of aid surged 161,000 to 5.73 million in the
week ended March 21, the latest week for which the data is
available, from 5.57 million the previous week.
This was the highest on record and lifted the insured
unemployment rate to 4.3 percent, the highest since a matching
4.3 percent in the week ending May 21, 1983. The insured
unemployment rate was at 4.2 percent in the week ended March
"What it says to me is the persistence of unemployment,"
said T.J. Marta, chief market strategist at Marta on the
Markets in Scotch Plains, New Jersey.
"It's more of a structural reallocation of resources, which
could be worse than anything we've seen since the Great
Depression," he said.
The four-week moving average for new claims, considered to
be a better gauge of underlying trends as it irons out
week-to-week volatility, climbed 6,500 to 656,750 in the week
ending March 28, from 650,250. That was the highest reading
since October 1982.
(Additional reporting by John Parry and Richard Leong in New
York; Editing by Andrea Ricci)