WASHINGTON - March 19, 2009 - New jobless claims fell more than expected last week, but continuing claims set a new record for the eighth straight week and few economists expect the labor market to improve anytime soon.

The Labor Department said Thursday that initial requests for unemployment insurance dropped to a seasonally adjusted 646,000 from the previous week’s revised figure of 658,000. That was better than analysts’ expectations.

But continuing claims jumped 185,000 to a seasonally adjusted 5.47 million, another record-high and more than the roughly 5.33 million that economists expected.

The four-week average of claims rose to 654,750, the highest since October 1982, when the economy was emerging from a steep recession, though the labor force has grown by about half since then.

“There is no sign of even a temporary easing in the downward pressure on employment,” Ian Shepherdson, chief U.S. economist at High Frequency Economics, wrote in a client note.