The number of Americans applying for first-time unemployment benefits rose last week to 354,000, the Labor Department said Thursday, an increase of 10,000 and higher than the number analysts were expecting.

Analysts polled by Thomson Reuters I/B/E/S expected, on average, claims for the seven days ended Saturday to remain flat at 340,000 from the previous week's 340,000.

For the seven days ended May 25, claims rose to 354,000, an increase of 10,000 from the previous week's revised figure of 344,000. The four-week moving average was 347,250, an increase of 6,750 from the previous week's revised average of 340,500.

"This week we had a bit of a pop, but we still are seeing a gradual improvement in the labor market," BNP Paribas economist Bricklin Dwyer told Bloomberg News.

"The problem hasn't really been from firing -- it's been on the other side with a lack of hiring." The number of people who continue to receive benefits from state programs following their initial week of aid rose by 63,000 to 2.99 million in the same week.