New claims for unemployment benefits soared by 51,000 to 419,000 for the week ended July 17, the Department of Labor said Thursday.
Economists had forecast 350,000 new claims, a decline of 10,000 from the previous week's initial estimate of 360,000. That estimate was revised up to 368,000.
The four-week moving average, which smoothes out week-to-week volatility and is considered by many to be a more reliable gauge of the health of the labor market, rose by 750 to 385,250.
Continuing claims, which are reported with a week's delay, fell 29,999 to 3,236,000.
The federal government last year launched new programs that provide benefits to people not eligible for traditional unemployment benefits. The total number of continued claims under all programs for the week ended July 3 was 12,573,833, a decline of 1,262,814 from the previous week.
In around two dozen states, most led by Republican governors or with GOP-controlled state legislatures, have brought the federal enhancement to state unemployment benefits to an early end. That enhancement paid an extra $300 a week in benefits, which priced many workers out of the labor market by paying them more not to work than they earned when working. In the rest of the country, the enhancements will expire in September.
Federal courts in Maryland and Indiana ordered the state governments to continue paying the extra $300, undermining efforts to repair the labor market before the nationwide end. It is a stark reminder of the outsized role judges have in curtailing democratic control of the government in our troubled times.