WASHINGTON: The number of Americans filing new claims for unemployment benefits unexpectedly rose last week, but the increase likely understated the rapidly improving labour market conditions as more parts of the economy reopen and fiscal stimulus kicks in.

The second straight weekly increase in claims reported by the Labour Department on Thursday was at odds with reports this month showing the economy created 916,000 jobs in March, the most in seven months, and job openings increased to a two-year high in February. Households have also been upbeat in their assessment of the labour market.

Initial claims for state unemployment benefits increased 16,000 to a seasonally adjusted 744,000 for the week ended April 3 compared to 728,000 in the prior week. Data for the prior week was revised to show 9,000 more applications received than previously reported.

The weekly subsidy and the Pandemic Unemployment Assistance (PUA) program will run through Sept. 6. Fraud, multiple filings and backlogs have dogged the system. Claims have dropped from a record 6.149 million in early April of 2020, but remain more than double their pre-pandemic level. In a healthy labour market, claims are normally in a range of 200,000 to 250,000.