New laims for unemployment benefits were little changed last week, a government report showed on Thursday, pointing to a marginal improvement in the labor market.

Initial claims for state unemployment benefits nudged down 1,000 to a seasonally adjusted 400,000, the Labor Department said.

Economists polled by Reuters had forecast claims rising to 405,000. The prior week's figure was revised up to 401,000 from the previously reported 398,000.

The claims data falls outside the survey period for the government's closely monitored employment report for July, which is scheduled for release on Friday.

Nonfarm payrolls likely increased 85,000 last month, according to a Reuters survey, after rising only 18,000 in June. The unemployment rate is expected to hold steady at 9.2 percent.

The labor market is being anxiously watched for signs whether the economy will regain speed after growth stalled in the first half of this year. Gross domestic product grew at an annual pace of 1.3 percent in the second quarter after a negligible 0.4 percent rate in the January-March period.

Data so far show the anemic growth pace persisted early in the third quarter, with manufacturing activity hitting a two-year low in July and the services sector expanding at its slowest pace in nearly 1-1/2 years.

Jobless claims are hovering around 400,000 and need to decisively break beneath that level to signal a sustainable improvement in the labor market.

A Labor Department official said there was nothing unusual in the data, adding there was no indication that a partial shutdown of the Federal Aviation Administration had affected last week's claims.

An impasse in Congress over the funding of the FAA has halted airport construction and inspections programs employing about 74,000 workers.

The four-week moving average of claims, considered a better measure of labor market trends, fell 6,750 to 407,750-the lowest since mid-April.

The number of people still receiving benefits under regular state programs after an initial week of aid rose 10,000 to 3.73 million in the week ended July 23.

The number of Americans on emergency unemployment benefits increased 12,193 to 3.18 million in the week ended July 16, the latest week for which data is available.

A total of 7.57 million people were claiming unemployment benefits during that period under all programs, down 75,192 from the prior week.

(Reporting by Lucia Mutikani; Editing by Neil Stempleman)

Social Security Unemployment Down