Unemployment: Continuing claims hit new high

NEW YORK (CNNMoney.com) -- The number of people filing initial claims for unemployment benefits fell last week, but the number filing for more than a week hit a fresh record high, according to a government report released Thursday.

In the week ended March 14, a total of 646,000 people filed initial jobless claims, down 12,000 from the previous week's revised figure of 658,000.

Economists had expected 655,000 new claims, according to a consensus survey by Briefing.com.

However, in a sign that more jobless are having trouble finding work, 5,473,000 people continued claiming unemployment in the week ended March 4 - the latest week for which data was available. That's an increase of 185,000 from the previous week.

"The labor market is still in disarray," said Ryan Sweet, senior economist at Moody's Economy.com. "More layoffs are ahead as businesses continue to cut costs to survive this recession."

While the decrease in first time filings was an encouraging sign, many economists say the 4-week moving average is a more accurate measure of the overall trend in initial claims.

The 4-week moving average for weekly filings, which smoothes out volatile peaks and troughs, was 654,750, up 3,750 from the previous week's revised average.

"The trend in initial claims continues to be a steady climb," Sweet said. "We're going to see more payroll pain ahead even as the recession moderates."

Joblessness will continue to rise until the first half of 2010, with the unemployment rate peaking near 10%, according to Sweet.

The Labor Department said earlier this month that the economy lost 651,000 jobs in February, bringing total job losses over the last six months to more than 3.3 million. That drove the unemployment rate up to 8.1% -- its highest level in 25 years.