The number of US workers making new claims for unemployment benefits tumbled unexpectedly last week to 271,000, the government reported today.
The US Labor Department said initial claims for state jobless aid fell 36,000 in the week ended January 14th from a revised 307,000 the prior week.
That was the largest one-week drop since late September and brought initial claims to their lowest level since April 2000, when they were 257,000.
Wall Street economists had forecast initial claims would rise to 315,000 from the initially reported 309,000 the prior week.
Analysts said there were no special factors behind last week's drop but noted that there is typically extra volatility in the data around the holidays.
The four-week moving average of initial claims, which smooths weekly volatility for a more reliable indication of underlying employment trends, fell by 12,000 to 299,000, the lowest level since October 2000.
Federal Reserve officials believe strong US growth has lifted the economy close to full employment - a theoretical concept indicating the lowest level of unemployment the United States can sustain without triggering wage inflation.
The unemployment rate dropped to 4.9 per cent in December despite lacklustre job growth of just 108,000 last month.