Initial jobless claims increase to 339,000

WASHINGTON -- Initial jobless claims rose last week, but remained at a level consistent with moderate labor market growth amid mixed signals recently about the strength of the economic recovery.

About 339,000 people applied for first-time unemployment benefits in the week ended Saturday, up from 331,000 the previous week, the Labor Department said Thursday. Economists had projected a slight decrease to 330,000.

The weekly claims figure, a key labor market indicator, has settled in recent weeks to about 335,000 after the usual holiday season volatility. The four-week average rose 3,500 last week, to 336,750.

PHOTOS: Federal Reserve chairs through the years

Economists say claims below 350,000 indicate moderate job creation. But labor market growth was sub-par in January and December, averaging just 94,000 net new jobs created, according to government data.

Despite those figures and some other weak economic reports, new Federal Reserve Chair Janet L. Yellen signaled this week that the central bank would continue to scale back a key stimulus program aimed at reducing unemployment.

Although job creation has been lackluster the past two months, the unemployment rate dropped to 6.6% in January, the lowest level since October 2008.