New applications for US unemployment benefits increased marginally last week, the government said Thursday as it also released revised data showing slightly better economic growth in the second quarter.

Initial jobless claims rose to 353,000, seasonally adjusted, in the week ended August 21, which was 4,000 more than the previous week, the Labor Department reported, but slightly less than analysts expected.

Jobless claims are a closely watched metric of labor market health, and soared into the millions last year as the Covid-19 pandemic began. They have dropped sharply in recent months, with vaccination campaigns bringing them near to their level before the virus arrived.

"The downward trend in claims continues, despite the Covid Delta wave, presumably because the bar to letting staff go is very high, given the tightness of the labor market," said Ian Shepherdson of Pantheon Macroeconomics.

But fears of the fast-spreading Delta variant of the virus, which is again complicating business in the United States, could keep some workers home, he said.

"The labor market hit from Delta, therefore, is more likely to come on the hiring side; claims have nothing to say about that."

While the US employment situation has improved from the worst of the pandemic, new jobless filings ticked up slightly in the latest week
While the US employment situation has improved from the worst of the pandemic, new jobless filings ticked up slightly in the latest week AFP / Angela Weiss

Another 117,709 new claims, not seasonally adjusted, were made under the Pandemic Unemployment Assistance program for freelance workers not normally eligible for aid, nearly 10,000 more than the week prior.

That program, and another for the long-term unemployed, will expire on September 6.

Through the week ended August 7, there were 12 million people still receiving benefits under all programs, the majority of which are under the special pandemic programs.

In a separate report, the Commerce Department revised its estimate of second-quarter growth to 6.6 percent from the original 6.5 percent, the first of two revisions it will make to the data.

The upgrade reflected the effects of government assistance programs on the economy, after President Joe Biden pushed Congress to enact a massive stimulus plan earlier this year, the country's third pandemic aid package.

"In the second quarter, government assistance payments in the form of loans to businesses and grants to state and local governments increased, while social benefits to households, such as the direct economic impact payments, declined," the Commerce Department said.

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