WASHINGTON — Fewer Americans sought unemployment benefits last week, indicating companies continue to hire at a modest pace.
Weekly applications fell 5,000 to a seasonally adjusted 366,000, the Labor Department said Thursday. The four-week average, a less volatile gauge, fell to 350,500, the lowest in nearly five years. The average is low because of seasonal factors, which cut applications last month.
Still, economists were encouraged. Weekly applications are a proxy for layoffs; When layoffs decline, net hiring typically rises.
The drop in the four-week average ‘‘supports the view that the US labor market is gradually improving,’’ said Jennifer Lee, a BMO Capital Markets economist.
Employers added an average of 200,000 jobs a month from November through January. In January, they added 157,000 jobs. Still, the unemployment rate ticked up to 7.9 percent in January. Overall, 5.6 million people got jobless benefits in the week ended Jan. 19; that’s less than half the number of unemployed.