New applications for jobless benefits declined for a third straight week, dropping to levels last seen in November, the US Labor Department reported on Thursday.
New claims fell to 779,000, seasonally adjusted, in the week ended January 30, fewer than expected and a drop of 33,000 from the previous week's downwardly-revised level.
However, even with the decline it was still a huge number indicating the ongoing toll from business restrictions brought on by the Covid-19 pandemic.
And the data showed another 348,912 new claims were filed last week under a separate program for freelance workers, underscoring the labor force's continued struggles.
"Still eye-wateringly huge numbers, with (greater than) 17 million still receiving some form of unemployment benefit," investment banker Dan Alpert said on Twitter.
The United States saw unemployment skyrocket after the Covid-19 pandemic began last March, with weekly claims climbing into the millions before declining as states relaxed restrictions and consumers felt more confident about venturing out.
While the latest data shows regular claims hitting their lowest level since late November, they remain well above the single worst week of the 2008-2010 global financial crisis.
Speaking before the data was released, Treasury Secretary Janet Yellen said the high levels of new claims shows the need for more government aid.
President Joe Biden's administration has proposed a $1.9 trillion rescue package that would pay for aid to small businesses and keep the unemployment safety net expanded during the pandemic going at least until September.
"We've got some tough months ahead until we get control of the pandemic, but we want to make sure we've got a good strong labor market (that) can put people back to work in these small businesses that need help," she told ABC's Good Morning America.