Jobless claims increased by 1,000 to 427,000 in the week ended June 4, Labor Department figures showed today in Washington. Economists surveyed by Bloomberg News projected a drop in claims to 419,000, according to the median forecast. The number of people on unemployment benefit rolls and those receiving extended payments decreased.
Some employers are cutting staff as demand slows because of elevated energy prices, falling house prices and tight credit. The economy generated the fewest jobs in May in eight months and the unemployment rate rose, a report showed last week.
“The labor market is obviously struggling,” Michael Feroli, chief U.S. economist at JPMorgan Chase & Co. in New York, said before the report. “I expect claims to stabilize and eventually come down.”