First-time claims for state unemployment benefits rose a seasonally adjusted 12,000 in the week ended March 28, hitting the highest level since October 1982, the Labor Department reported Thursday. These initial claims totaled 669,000, a level that is up 72% from the same period in the prior year. The four-week average of these initial claims increased 6,500 to stand at 656,750 -- also the highest level since October 1982. The four-week average is considered a better gauge of labor market conditions than the volatile weekly figures because it smoothes out one-time distortions caused by holidays, bad weather or strikes. For the week ended March 21, the number of people collecting state unemployment benefits reached yet another new record, jumping 161,000 to 5.73 million -- 96% greater than in the prior year. The four-week average for continuing claims also rose, up 163,500 to a record 5.5 million. Initial claims represent job destruction, while the level of continuing claims indicates how hard or easy it is for displaced workers to find new jobs. The latest claims report shows little evidence that businesses aren't laying off workers at a rapid pace, and finding a replacement job remains difficult for those who've lost work. "Needless to say, these are terrible numbers, especially the continuing claims figure, which really is disturbing," wrote Dan Greenhaus of the equity strategy group at Miller Tabak. "I hope to see some moderation in these weekly figures as we progress through April or we're going to have to get accustomed to monthly job losses of more than 600,000 yet again." Meanwhile, the insured unemployment rate -- the proportion of covered workers who are receiving benefits -- rose to 4.3% from 4.2%, reaching the highest level since May 1983. The data come from state unemployment offices' reports on actual filings, not a statistical sample or a hunch. Escalating levels of initial and continuing claims signal prospects of an approaching double-digit unemployment rate, in the view of many economists. On Friday, the government will report nonfarm payrolls for March, and analysts polled by MarketWatch are looking for about 660,000 job losses as well as an unemployment rate of 8.5%. In February, the economy lost 651,000 jobs, and the jobless rate rose to 8.1%, the highest rate in more than 25 years. Earlier this week, the ADP employment index reported that the U.S. labor market worsened again in March, as private-sector firms cut 742,000 jobs. Typically, state unemployment benefits run out after 26 weeks for those who are eligible. Benefits are generally available for those who lose their full-time job through no fault of their own. Those who exhaust their unemployment benefits are still counted as unemployed if they are actively looking for work. A total of about 1.5 million people were collecting benefits under a federal program that extends unemployment benefits past six months.

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