Pres. Obama Heads to Martha's Vineyard as New Jobless Claims Hit 500,000

(Associated Press) - New applications for unemployment insurance reached the half-million mark last week for the first time since November, a sign that employers are likely cutting jobs again as the economy slows.

The Labor Department said Thursday that initial claims for jobless benefits rose by 12,000 last week to 500,000, the fourth increase in the past five weeks. Wall Street economists forecast that claims would drop.

The four-week average, a less volatile measure, rose by 8,000 to 482,500, the highest since December. There were no special factors that distorted the numbers, a Labor Department analyst said.

The increase suggests the economy is creating even fewer jobs than in the first half of this year, when private employers added an average of about 100,000 jobs per month. That's barely enough to keep the unemployment rate from rising. The jobless rate has been stuck at 9.5 percent for two months.

Stock futures fell on the news. The Dow Jones industrial average futures had risen more than 50 points before the report was released. They dropped quickly and were down as much as 20 points afterward.