NEW YORK (CNN/Money) -
Jobless claims rose last week, the government said Thursday, climbing even higher above the benchmark 400,000 that signifies job-market weakness.
The Labor Department report said 422,000 people filed for benefits in the week ended Sept. 6, compared with an upwardly revised reading of 419,000 in the prior week. Economists, on average, expected 400,000 new claims, according to a Reuters poll.
"These jobless claims figures strongly suggest that any discussion of a runaway economic recovery have been greatly exaggerated," said Anthony Chan, chief economist at Banc One Investment Advisors. "Instead, what we see here is a recovery that continues to face significant headwinds emanating from the employment front."
U.S. stocks rose in midday trading despite the weakness of the report, and Treasury bond prices fell.
Though the economy's growth has clearly accelerated in the late summer and fall, the long-suffering labor market has shown few signs of recovery. Many economists now believe the economy's problems are structural rather than cyclical, that technology-driven gains in productivity have enabled manufacturers to make more goods with fewer workers.
"Until businesses feel a real need for more hands-until productivity alone won't allow them to reach their earnings goals-they won't begin hiring," said Oscar Gonzalez, economist at John Hancock Financial Services in Boston, warning the labor market could put the broader recovery could at risk.
Many manufacturers, and many politicians, say competition for cheap labor from other nations, particularly China, has made it difficult for U.S. businesses to hire U.S. workers, and have called for measures to level the playing field, including forcing China to revalue its currency.
Most analysts doubt China will revalue its currency quickly enough to impact the U.S. labor market, however.
Many economists view 400,000 as the sign of a soft job market. Claims were above 400,000 from mid-February to mid-July, 22 straight weeks. Claims dropped in late August to the lowest level since early February, though the data in July and August were skewed somewhat by summer factory shutdowns.
The four-week moving average of new claims, which irons out the volatility of the weekly data, rose to 407,250 from a revised 402,750 the prior week.
Continued claims, the number of people out of work for a week or more, rose to 3.67 million for the week ended Aug. 30, the latest data available, from a revised 3.61 million the prior week.