WASHINGTON (MarketWatch) -- Jobless claims moved higher last week, pointing the way to an increase in the nation's unemployment rate, economists said Thursday.

New applications for state unemployment benefits increased by 15,000 in the week ended Oct. 18 to a seasonally adjusted 478,000, boosted by about 12,000 new claims stemming from Hurricane Ike, the Labor Department reported.

The four-week average of seasonally adjusted initial jobless claims -- which smoothes out one-time events such as holidays or weather -- fell by 4,500 from the seven-year high of 484,750 set the previous week. Read the full government report.

The "underlying outlook for the deteriorating labor market" has worsened, wrote Mike Englund, chief economist for Action Economics. "The ongoing deterioration in the underlying claims trajectory worsens the outlook for the November report, as does the global broading in the ongoing financial crisis that is inevitably boosting fear among employers."

Meanwhile, the number of people collecting regular state unemployment benefits fell by 6,000 to a seasonally adjusted 3.72 million in the week ended Oct. 11, while the four-week average of continuing claims rose by 44,250 to 3.68 million, the highest in more than five years.

"The rise in continuing claims suggests that the unemployment rate moved higher in October," wrote John Ryding and Conrad DeQuadros of RDQ Economics. September's jobless rate was 6.1%.

The government's October employment survey was conducted last week, with the results to be released on Nov. 7. Compared with September's survey week, initial claims are up about 8%, while continuing claims are up about 6%.

The Labor Department also reported that during the week ended Oct. 4, 1.1 million people were collecting extended federal benefits available to those who've exhausted their state benefits. That was down by 290,000 from the previous week.

Typically, unemployment benefits run out after 26 weeks for those who are eligible. The new law extends unemployment benefits for an additional 13 weeks under the separate federal program.

Initial claims represent job destruction, while the level of continuing claims indicates how hard or easy it is for displaced workers to find new jobs.

In the past year, initial jobless claims have risen 47%, while continuing claims are up 44%.

The U.S. economy has lost jobs for nine consecutive months, and more losses are expected in October. So far in 2008, nonfarm payrolls have fallen by 760,000 to stand at 137.3 million.

Benefits are generally available for those who lose their full-time job through no fault of their own. Those who exhaust their benefits are still counted as unemployed if they are actively looking for work.