Washington ? Fewer Americans signed up for unemployment benefits last week, raising hopes for the job market to show improvement in the new year.

New applications for unemployment insurance dropped by a seasonally adjusted 5,000 to 326,000, the lowest level since Dec. 11, the Labor Department reported Thursday.

The newest snapshot of the labor market was better than economists were anticipating. They were expecting claims to rise to about 335,000.

“The claims figures continue to strongly suggest that we are inching toward a further improvement in labor market conditions,” said Anthony Chan, senior economist at JPMorgan Fleming Asset Management.

Chan believes that slower productivity growth and a solid economic expansion will spur companies to step up hiring in the months ahead.

Strengthening job creation has been an important task for President Bush. The still-recovering job market has been seized upon by Democrats who contend the president’s economic policies have failed to induce a steady hiring spree by businesses.

Employers added 112,000 jobs in November, down from 303,000 in October. Economists, however, are hoping for a pickup in December’s payrolls and are forecasting the addition of around 175,000 jobs during the month. The jobless rate is expected to hold steady at 5.4 percent. The employment report for December will be released by the government next week.

Looking ahead, the Bush administration predicts the economy will create an additional 2.1 million jobs in 2005 — a figure private economists consider respectable. Still, that’s a much lower estimate than a previous forecast that 3.6 million jobs would be created next year.