Improvement in the US economy has led to decline in the numbers of people who applied for unemployment benefits last week. Jobless claims fell by 14,000 to 298,000 as on August 16.

Employers are planning additional hiring in order to meet the demands as the second-half economic growth has been estimated higher. Reduction in Jobless claims also strengthened Federal Reserve policymakers' view that the labor market is improving.

Ryan Sweet, a senior economist at Moody's Analytics, said that the fall in the claims is sending positive signals for the improvement and growth of the economy and the job market.

The monthly average of the claims increased to 300,750 from 296,000 last week. Payroll increased by more than 200,000 last month for six successive years.

The jobless rate climbed to 6.2 % during the last month. The revised rates given by the Labor Department showed an increase of 1,000 more applicants than the previously reported.

The four weeks average claim is considered to be a better measure for the trends of labor market as it strengthens week-to-week instability. The four-week average claim fell by 8,500 between July and August. On the other hand, it remained steady on job growth and claims are back at the position that was during the pre-recession levels.

Nonfarm payrolls saw an increment by 209,000 in July, making it a sixth consecutive month when growth of jobs topped 200,000, which is a sign of potency that was last observed in 1997.

Policy meeting of Federal Reserve's showed that officials have noted the improvement in the labor market which gives an indication that interest rates could be increased early.

The jobless claims report unveils that the number of people still receiving the unemployment benefits after the first week of aid fell by 49,000 to 2.50 million in the week ended on August 9.