WASHINGTON — Hurricane Sandy drove the number of people seeking unemployment benefits up to a seasonally adjusted 439,000 last week, the highest level in 18 months.
The Labor Department said Thursday that weekly applications increased by 78,000, mostly because a large number of applications were filed in states damaged by the storm. People can claim unemployment benefits if their workplaces close and they don’t get paid.
The storm has affected the claims data for the past two weeks and may distort reports for another two weeks, the department has said.
Sal Guatieri, an economist at BMO Capital Markets, said that a similar jump in applications occurred after Hurricane Katrina in 2005.
“We should see a full retracement of this increase in coming weeks,” he said. Applications were declining before the storm, he added, “though levels are consistent with moderate, rather than strong, job growth.”
The four-week average of applications, a less volatile number, increased to 383,750.
The storm hit the East Coast on Oct. 29 and disrupted businesses from North Carolina to Maine. The storm also cut power to roughly 8.5 million homes and businesses in 10 states. Some are still without power.
Before the storm, weekly applications had fluctuated between 360,000 and 390,000 since January. At the same time, employers have added an average of nearly 157,000 jobs a month, barely enough to lower October’s unemployment rate of 7.9 percent.
There are some signs that the job market is improving. Employers added 171,000 jobs in October and hiring in August and September was stronger than first estimated. The economy has gained an average of 173,000 jobs a month since July. That’s up from an average of 67,000 a month in April through June.
The unemployment rate rose slightly in October from 7.8 percent in the previous month because more Americans began looking for work. That suggests some felt their chances of finding a job had improved.
Not all of them found jobs, which pushed up the unemployment rate. The government only counts people as unemployed if they are actively searching for work.
The number of people continuing to receive benefits fell about 100,000 to just under 5 million in the week ended Oct. 27, the latest data available. Some of those no longer receiving benefits may have gotten jobs. But many have used up all the benefits available.
Rising food costs and higher rents offset a drop in gas prices last month, leaving consumer inflation all but flat in October.
The consumer price index rose a seasonally adjusted 0.1 percent in October, the Labor Department said Thursday. That’s down from sharp gains of 0.6 percent in the previous two months, which were driven by a spike in gasoline prices that has since receded.
Gasoline prices fell 0.6 percent last month. Food prices rose 0.2 percent, pushed higher by steep increases in milk and cheese costs.
Excluding volatile food and gasoline, prices increased 0.2 percent last month.
The cost of shelter, which includes rents, rose 0.3 percent, the most in more than four years. Rental vacancies have declined in recent months, pushing rents higher. Hotel costs also increased last month.
Clothes and airline fares also rose last month. The price of new and used cars fell.
Over the past 12 months, overall consumer prices have increased just 2.2 percent. That’s only slightly above the Federal Reserve’s inflation target of 2 percent.
“Inflationary pressures at the consumer level are modest,” Steven Wood, an economist at Insight Economics, said in a note to clients.
Business, Pages 27 on 11/16/2012