New applications for U.S. unemployment benefits fell last week to a near 54-year low as employers held on to workers in a tight labor market.

Initial jobless claims, a proxy for layoffs, fell to 166,000 during the week that ended on April 2, compared with a revised 171,000 the prior week, the Labor Department said Thursday. The weekly total was the lowest since November 1968, when the labor force was less than half of its current size.