The number of Americans filing new claims for unemployment benefits unexpectedly fell last week, pointing to still tight labor market conditions.

Initial claims for state unemployment benefits dropped 5,000 to a seasonally adjusted 207,000 for the week ended April 20, the Labor Department said on Thursday.

Economists polled by Reuters had forecast 215,000 claims in the latest week. Claims have been bouncing around in a 194,000-225,000 range this year.

Companies are hoarding workers after experiencing difficulties finding labor during and after the COVID-19 pandemic, and are enjoying higher profit gains because of strong pricing power. Low layoffs are keeping wage growth elevated, sustaining consumer spending, which accounts for more than two-thirds of economic activity.

The number of people receiving benefits after an initial week of aid, a proxy for hiring, declined 15,000 to 1.781 million during the week ending April 13, the claims report showed.

The so-called continuing claims data covered the period during which the government surveyed households for April's unemployment rate. Continuing claims fell between the March and April survey periods. The unemployment rate slipped to 3.8% in March from 3.9% in February.