Unemployment benefits jump again due to jitters in the economy

Unemployment benefits rose to its highest level in eight months, dampening the positive outlook in the job market. Analysts believe that skyrocketing gas prices have also forced employers to implement layoffs or postpone hiring more workers.

An estimated 185,000 jobs were created last month, down from 216,000 jobs made in March and again not enough to significantly bring down the unemployment rate which stands at 8.8 percent.

Hope for a sustained recovery was growing in recent weeks as businesses were expected to add some 200,000 jobs for April but the actual numbers fell short of expectations. Now, the sudden rise in applications for unemployment benefits confirms that job growth is still uneven and may be that way for quite a long time.

American motorists are cringing when they fill their gas tanks because average gas prices have increased for 44 consecutive days. The high gas prices are such a drain on people's wallets that they have little left to spend elsewhere. In turn, this has made businesses skeptical about the economic recovery and rethinking their hiring strategies.

Laid-off workers will still have to depend on unemployment benefits to make up for lost or eroded income. Consumer spending, a good determinant of recovery, is still weak despite earlier rosy forecast.

Many economists are still optimistic that the economy will grow at a more steady rate and business hiring will pick up at the late part of the year. Certainly, positive data from other sectors in the economy bring hope. Carmakers reported strong sales and factory production increased, partly making up for the bad news about the spike in unemployment benefits.