The number of workers filing new applications for unemployment insurance fell less than expected last week, government data showed on Thursday, pointing to a gradual labor market recovery.

Initial claims for state unemployment benefits dipped 3,000 to a seasonally adjusted 456,000 in the week ended June 5, the Labor Department said.

Analysts polled by Reuters had expected claims to slip to 448,000 from the previously reported 453,000, which was revised to up to 459,000 in Thursday's report.

The four-week moving average of new claims, considered a better measure of underlying labor market trends, rose 2,500 to 463,000.

A Labor Department official described the report as straight forward.

The labor market, the Achilles heel of the economy as it recovers from the worst downturn since the 1930s, suffered a setback in May when businesses sharply scaled back on hiring after a spurt in the prior two months.

Government data last Friday showed private payrolls only grew 41,000 after expanding 218,000 in April.

With both the weekly claims and the four-week moving average hovering above levels analysts view as consistent with sustainable job growth, unemployment will likely remain high for a while, piling pressure on President Barack Obama.

Public disenchantment over a near 10 percent unemployment rate and the slow pace of the economic recovery are weighing on Obama's approval ratings and threaten the Democratic Party's control of Congress in November's mid-term elections.

Still, measured progress is in place in the labor market. In the final week of May, the number of people still receiving benefits after an initial week of aid fell 255,000, the largest decline this year, to 4.46 million, the Labor Department said.

That was the lowest level since December 2008 and could be both a reflection of laid off workers getting jobs and exhausting their benefits.

Markets had expected so-called continuing claims only fall to 4.64 million.

The insured unemployment rate, which measures the percentage of the insured labor force that is jobless, slipped to 3.5 percent from 3.7 percent.

(Reporting by Lucia Mutikani; Editing by Neil Stempleman)

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