If the rise in first-time claims for US unemployment benefits is some kind of an indication about the condition of the economy, it would apparently indicate the year-long economic slump getting deeper!

After a brief slowdown in the number of workers filing new claims during the holiday season, last week the earlier rise rebounded more than projected, as companies intensified job-cuts at the beginning of the year.

According to the Labor Department, the first-time claims for state unemployment insurance benefits increased by 54,000 to an adjusted 524,000 in the week ending January
10 – a week earlier the growing figures were revised at 470,000.

The unemployment rate among those who are eligible for the claims held at 3.4 percent. While twenty-seven states and territories showed a rise in new claims for the week that ended January 3, twenty-five reported a fall.

Unemployment claims reveal weekly firings, and as such mostly lean towards an increase when job growth - calculated by the monthly payroll statement – becomes slow. The government’s last week data shows that with the companies steadily removing workers from their payrolls in December, the total number of job losses for 2008 reached 2.6 million.

In an interview with Bloomberg Television, Dan North - the chief economist at Euler Hermes ACI in Owings Mills, Maryland - said: “We’ve had consistent numbers that are worse than expectations. That kind of tells you that the recession seems to be accelerating just a little bit and puts the forecast of a second-half recovery at risk.”