The Labor Department said Thursday that new claims for jobless benefits fell by 3,000 to a seasonally adjusted 450,000, the third decline in four weeks. Many economists had expected an increase.
Claims have fallen by 11 percent in the past month, after jumping to 504,000 in the week ending Aug. 14. The decline indicates layoffs are easing, even as the pace of economic growth has slowed since earlier this year.
The four-week average of new claims, which reduces volatility, fell sharply to 464,750, down 13,500 from the previous week.
The report follows other data earlier this week that shows the economy is still growing, but at a slow pace. Reports on retail sales and industrial production both showed modest gains.
Still, many economists forecast that economic output will increase by less than 2 percent in the current quarter. That's down from 3.7 percent in the January-to-March quarter and not fast enough to reduce the unemployment rate, which is currently 9.6 percent.
The unemployment claims report covers the week that included Labor Day, and claims frequently drop in holiday-shortened weeks.
Initial claims are still above levels that would signal widespread hiring. In a healthy economy, claims usually fall below 400,000.
The number of people receiving benefits fell by 84,000 to just below 4.5 million. But that doesn't include several million people who are receiving unemployment aid under extended programs approved by Congress during the recession. The extended benefit rolls fell by more than a half-million to just under 5 million in the week ending Aug. 28, the latest data available.