Economy

More Americans than expected filed initial jobless claims last week, as job creation remains stubbornly sluggish.

Claims increased 13,000, to 472,000, while forecasters expected a slight drop to about 455,000 from the previous week's seasonally adjusted 457,000, according to Labor Department figures released Thursday.

Job numbers for June are expected Friday morning and could show a bleak economic outlook for the job market as temporary hiring for the census has ended. The key number to watch is private-sector hiring, which according to one private report will have added only 13,000 jobs last month.

The four-week moving average, which smoothes out the volatility of the weekly number and is a better look at the employment picture, increased 3,250, to 466,500, from the previous week's revised average of 463,250, the highest in almost three months.

The vote failed 58-38 on the two-pronged measure that included a $34 billion six-month extension of unemployment benefits.

After changing the schedule several times in the past hour, the Senate is now voting on a motion to end debate on a bill that will extend unemployment benefits. 

This story is developing. 

The House and Senate will vote Thursday on separate bills to extend unemployment benefits for more than 1 million Americans. 

The House is expected to pass a nearly $34 billion stand-alone version of the bill to extend benefits through November for the long-term jobless, which is around 7 million people. 

The Senate will vote to end a Republican filibuster on a two-pronged measure that includes the benefits extension and provides homebuyers with an extra three-months to close on a purchase that qualifies for a federal tax credit up to $8,000. 

Through Wednesday, Senate Democrats were one vote short of the 60 votes needed to advance the bill. The vote is expected around 5:30 p.m. Thursday, after Sen. Robert Byrd (D-W.Va.) lies in repose for most of the day in the Senate chamber. 

If the Senate passes its legislation, the House would probably follow suit before the July 4 recess begins, according to a senior Democratic aide. That vote would likely take place Friday unless the process can be expedited. 

The House and Senate appeared set Wednesday to leave Washington for a weeklong recess without extending unemployment benefits. 

Sen. George Voinovich (R-Ohio) on Wednesday urged Senate Majority Leader Harry Reid (D-Nev.) to offset at least half the cost of extending unemployment benefits by using unspent stimulus funds, but Reid refused. 

"He flatly rejected this request even though Democratic leadership was going to take $10 billion from the stimulus to help pay for business tax breaks just last week," Voinovich said in prepared remarks. "My concern is that Democrats are more interested in having this issue to demagogue for political gamesmanship than they are in simply passing the benefits extension. I came to the table with a fair compromise and the ball is in their court." 

Senate Majority Leader Harry Reid (D-Nev.) on Wednesday said two Republicans will support his new extension to unemployment benefits and that he is hopeful a third and final Republican will eventually back the bill.

"If we had Senator Byrd's replacement we would have 60," he told reporters. "We have to wait and see what a couple of Republicans do." 

The House is expected to approve a stand-alone extension of unemployment benefits on Wednesday,  leaving the matter up to the Senate. 

The House Rules Committee agreed to set up a same-day rule for the bill for Wednesday. 

An attempt to move the legislation on Tuesday under suspension of House rules failed after it did not win the  two-thirds majority that is necessary. In the 261-155 vote, 16 Democrats crossed party lines and voted no, while 30 Republicans voted for the measure.

All but two of the Democrats are members of the fiscally conservative Blue Dog Coalition. The 14 Blue Dogs were: Reps. Marion Berry (Ark.), Travis Childers (Miss.), Jim Cooper (Tenn.), Joe Donnelly (Ind.), Jim Marshall (Ga.), Betsy Markey (Colo.), Frank Kratovil (Md.), Baron Hill (Ind.), Stephanie Herseth Sandlin (S.D.), Walt Minnick (Idaho), Glenn Nye (Va.), Bobby Bright (Ala.) and Heath Shuler (N.C.). The other two were Reps. John Adler (N.J.) and Melissa Bean (Ill.). 

The House failed Tuesday afternoon to pass an unemployment benefits extension under suspension of the rules. 

Consumer confidence declined sharply in June after three straight months of improvement as worries heightened over the slowly recovering economy and sluggish job market.

The index fell to 52.9 this month from a revised 62.7 in May, a drop that was greater than expected by analysts, according to the Conference Board’s index. 

Despite signs of an expanding economy, consumer confidence isn't likely to improve until job growth picks up. The June employment report is due out Friday, and is likely to show a decrease in job growth as the federal government winds down temporary hiring for the Census.

Private sector hiring needs to show improvement to begin making a dent in the more than 8 million jobs lost during the protracted recession.