For the second consecutive week, the Labor Department released a report on Thursday showing an unexpected increase in first-time claims for U.S. unemployment benefits.
The report said initial jobless claims climbed to 261,000 in the week ended January 6th, an increase of 11,000 from the previous week's unrevised level of 250,000.
The modest increase came as a surprise to economists, who had expected initial jobless claims to edge down to 245,000.
The unexpected increase lifted jobless claims to their highest level since hitting 269,000 in the week ended September 23, 2017.
The less volatile four-week moving average also rose to 250,750, an increase of 9,000 from the previous week's unrevised average of 241,750.
The Labor Department said claims taking procedures continue to be disrupted in the Virgin Islands, while the claims taking process in Puerto Rico has still not returned to normal.
Meanwhile, the report said continuing claims, a reading on the number of people receiving ongoing unemployment assistance, fell by 35,000 to 1.867 million in the week ended December 30th.
With the decrease, continuing claims dropped to their lowest level since hitting 1.805 million in December of 1973.
The four-week moving average of continuing claims also dipped to 1,913,250, a decrease of 5,500 from the previous week's revised average of 1,918,750.
Last Friday, the Labor Department's more closely watched monthly jobs report showed employment increased by much less than anticipated in December.
The report said non-farm payroll employment climbed by 148,000 jobs in December after spiking by an upwardly revised 252,000 jobs in November.
Economists had expected employment to increase by 190,000 jobs compared to the addition of 228,000 jobs originally reported for the previous month.
Meanwhile, the Labor Department said the unemployment rate came in at 4.1 percent in December, unchanged from the two previous months and in line with economist estimates.