Pasadena, CA -- (SBWire) --05/28/2011 --The initial unemployment claims that were filed last week were unexpectedly high, reaching a total of 424,000 people for the week ending May 21.

Economists surveyed by Bloomberg were expecting it to drop to 404,000. The reason that the initial unemployment claims figure is so important that consistent gains in hiring translate into increased consumer spending. And since around 70% of the American economy depends on consumer spending, a sustained increase in initial jobless claims is not a good sign for the economy.

The number of Americans receiving jobless benefits was 3.69 million for the week ending May 14. This was a decrease of 46,000 people on the rolls. But the figure does not include people who continue to receive benefits under various federal programs. There are 4.05 million Americans who are now getting emergency and extended payments as of May 7.

The continuing jobs cuts made at several local and state government levels are one of the main reasons for the increase in these initial filings. But the private sector is making modest gains in adding jobs.

Hound, a job search engine, has been successful in locating over 183,000 jobs directly from employer websites in the last seven days.