New economic statistics paint a somber picture for the U.S. job market as well as America's retail sector. From Washington, VOA's Michael Bowman reports.

The U.S. Labor Department says the number of people filing for federal unemployment benefits has risen to the highest level in more than six years. New applications for jobless benefits rose by a seasonally-adjusted 7,000 to 455,000 people for the week ending August 2, the highest level since March, 2002.

As of the end of last month, a total of 3.3 million Americans were receiving benefits amid an unemployment rate of 5.7 percent, a five-year high.

In recent weeks, major U.S. carmakers, building products suppliers, and upscale coffee chains have announced job cuts.

Not only are more Americans struggling to find and keep jobs, even those with an income are increasingly hard-pressed to pay for higher energy and food costs. As a result, new U.S. retail sales figures show overall declines, with consumers increasingly favoring bargain stores. Discount and warehouse retailers are among the few bright spots in the latest sales figures.

Retail sales analyst Ken Perkins, who heads the research firm Retail Metrics, says Americans are altering their consumption habits in response to tight family budgets.

"Slow economic growth here, coupled with tighter credit and inflationary pressures - [as a result of these factors] consumers are really feeling the pinch and trying to stretch every dollar they can," Perkins said.

Earlier this year, the federal government sent out tax rebate checks to tens of millions of Americans. The economic stimulus package is believed to have contributed to a slight uptick in economic growth. U.S. gross domestic product expanded at an annual rate of 1.9 percent for the second quarter of this year after teetering on the brink of recession for the previous two quarters.

The last of the tax rebates were issued last month, and many economists fear the boost in activity spurred by the checks could be short-lived.