Jobless claims rise in latest week

New claims climbed by 4,000 to 319,000; reading marks the sixth increase in past seven weeks, suggesting that labor market is taking a hit.

WASHINGTON (AP) -- The number of laid-off workers filing claims for unemployment benefits rose last week in another worrisome sign that the labor market is weakening.

The Labor Department reported Thursday that new claims for unemployment benefits rose by 4,000 last week to 319,000. It marked the sixth increase in the past seven weeks and was a further sign that the economy is feeling the impact of a steep slump in housing and a spreading credit crisis.

The net decline in payroll jobs in August came as a surprise. Analysts had been expecting an increase of 110,000 jobs, in line with growth this year. In other bad news, the number of jobs created in June and July was trimmed by 81,000, indicating the labor market was not performing as well as had been thought.

The surprisingly bad report increased worries that the current economic recovery, now in its sixth year, could be in danger of falling into a recession.