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NEW YORK (CNNMoney.com) -- The number of people filing initial claims for unemployment benefits unexpectedly rose last week, while those filing continuing claims hit an all-time high for the 10th straight week, according to a government report released Thursday.

In the week ended March 28, a total of 669,000 people filed initial jobless claims, up 12,000 from the previous week's upwardly revised figure of 657,000, the Labor Department reported.

It was the largest weekly increase since October 1982, and it surprised economists surveyed by Briefing.com, who had forecast initial claims to decline to 650,000.

The number of people continuing to file for jobless benefits rose 161,000 to 5.7 million in the week ended March 21, the latest week for which data was available. It was the highest number since the government began keeping records in 1967, and the 10th consecutive week that continuing claims rose to a record high.

The increasing number of people continuing to file for unemployment benefits suggests that Americans are struggling to re-enter the workforce.

The 4-week moving average for weekly filings, which smoothes out volatile peaks and troughs, was 656,750, up 6,500 from the previous week's revised average.

Earlier this month, initial claims and the 4-week moving average had declined slightly, raising some hopes that the labor market was stabilizing. Given last week's increase, however, that seems improbable, according to Andrew Gledhill, an economists at Moody's Economy.com.

"This increase is definitely bad news," Gledhill said. "This is the worst labor market downturn at least since the 1980s, and I don't expect it to subside soon," he said.

The report comes one day before the government's closely watched monthly jobs report. The Labor Department is expected to report Friday that the economy shed 658,000 jobs in March, more than the 651,000 reported for February, according to a consensus estimate of economists complied by Briefing.com. The unemployment rate is forecasted to rise to 8.5% from 8.1%.