NEW YORK (CNN/Money) - New weekly jobless claims in the United States fell last week, the government said Thursday, indicating the labor market is slowly recovering after shedding more than 1.5 million jobs last year.

The Labor Department said the number of Americans filing new claims for unemployment benefits fell to 376,000 in the week ended Aug. 3 from a revised 391,000 the prior week. Economists, on average, expected 385,000 new claims, according to Briefing.com.

The jobless claims data follow the Labor Department's report earlier this month that the nation's unemployment rate held steady at 5.9 percent in July, while employers added just 6,000 new jobs.

U.S. businesses cut more than 1.5 million jobs during a recession that began in March 2001 and lately have been able to get more production out of fewer workers, making them reluctant to increase hiring until they see a need to greatly expand production.

In Thursday's report, the four-week moving average of new jobless claims, which smoothes out fluctuations in the weekly data, fell to 379,000 last week from a revised 386,750 the prior week.

Continued claims, the number of people drawing benefits for more than a week, rose to 3.53 million in the week ended July 27, the latest data available, from a revised 3.48 million the prior week.

In a separate report Thursday, the Labor Department said its producer price index, a key measure of wholesale inflation, fell 0.2 percent in July after rising 0.1 percent in June. Excluding food and energy prices, PPI fell 0.3 percent after rising 0.1 percent in June. Economists expected PPI and core PPI each to rise 0.1 percent, according to Briefing.com.