The number of Americans applying for unemployment benefits dropped by 42,000 last week to a seasonally adjusted 338,000, the biggest drop since November 2012.
The government's partial shutdown means the September jobs report is being postponed. The workers who produce it aren't deemed "essential," which is why they're among the 800,000 federal employees being furloughed.
More than 300,000 people stopped working or looking for a job in August. Their exodus shrank the so-called labor force participation rate the percentage of adult Americans with a job or seeking one to 63.2 percent.
American businesses added 176,000 jobs in August, a private survey showed Thursday. That was fewer than in June and July but roughly in line with the monthly average for the year.
The number of Americans applying for unemployment benefits fell 19,000 last week to a seasonally adjusted 326,000, the fewest since January 2008. The decline shows the job market continues to strengthen.