"The improvement in first week of July was exaggerated by the timing of plant closures," Vitner said. "This is something we're going to be dealing with throughout the month."

Meanwhile, the number of people requesting continued jobless benefits rose to a record high, indicating that the labor market remains weak.

The government said continuing claims rose to 6,883,000 in the week ended June 27, the most recent data available.

That's an increase of 159,000 from the previous week's revised total of 6,724,000 and was the highest reading since the Labor Department began keeping records in 1967.

The 4-week moving average of continuing claims rose 12,000 to 6,769,000.

The ongoing rise in continuing claims suggests that more workers are struggling to re-enter the work force.

"While layoffs have topped out, hiring has not picked up," Vitner said. "The increase in unemployment rate going forward will be more a result of lack of hiring rather than layoffs," he said.