The number of Americans filing new claims for jobless benefits (search) fell 21,000 last week, the Labor Department (search) said on Thursday in a report it said may reflect a holiday-shortened workweek and fewer layoffs in the auto industry.

First-time applications for state unemployment aid fell to 330,000 in the week ended June 4 from an upwardly revised 351,000 the prior week, the Labor Department said.

Wall Street economists had forecast claims would fall to 335,000 from the originally reported 350,000 the prior week.

A Labor Department analyst attributed this week's drop in claims to a shorter workweek due to Memorial Day and an easing in the number of auto sector layoffs. Michigan reported 10,419 layoffs in the motor vehicle sector in the week ended May 28.

The closely watched four-week moving average of claims, viewed as a better gauge of labor trends because it smooths weekly volatility, fell to 331,750 from 334,500 in the prior week.

The number of people who remained on the benefit rolls after claiming an initial week of aid fell 4,000 to 2.59 million in the week ended May 28, the latest week for which data are available.