The number of Americans filing new applications for unemployment benefits fell last week, which may help ease fears of a worsening labor market after an unexpected drop in employment in February.

Initial claims for state unemployment benefits fell by 1,000 to a seasonally adjusted 213,000 in the week ended March 7, the Labor Department said Thursday. Economists polled by Reuters had forecast 215,000 claims for the latest week.

Claims this year have hovered in the 199,000-232,000 range amid fewer layoffs. They remain at a level consistent with a stable labor market. The government reported last week that nonfarm payrolls fell by 92,000 jobs in February, the sixth decline since January 2025 and the second largest.

The decline was attributed to harsh winter weather, a strike by healthcare workers and returns following gains in outside payrolls in January, as well as import tariff uncertainty and general hesitancy by businesses to integrate artificial intelligence into some work roles.

The US Supreme Court struck down President Donald Trump’s sweeping tariffs, which he pursued under the National Emergency Use Act. But Trump responded to the ruling by imposing 10% global tariffs, which he said would rise to 15%.

The Trump administration said Wednesday it is launching two trade investigations into excess industrial capacity and forced labor in 16 major trading partners.

The US-Israel war with Iran, which has pushed up oil and gasoline prices, poses a downside risk to the labor market, economists said. Rising gasoline prices and stock market volatility are weighing on consumer spending and dampening demand for workers.

Sluggish hiring has left many unemployed people, including recent college graduates, experiencing long periods of unemployment. The number of people receiving jobless benefits, a proxy for hiring, fell by 21,000 to 1.850 million in the week ended Feb. 28 after the initial week of aid, the claims report showed.

Last year’s unemployed college graduates are not included in the claims data because they have limited or no work history, which disqualifies them from claiming unemployment benefits.

The unemployment rate rose to 4.4% in February from 4.3% in January.