WASHINGTON (Reuters) -The number of Americans filing new applications for unemployment benefits fell last week, but the labor market has lost its luster amid an anemic pace of hiring.

Initial claims for state unemployment benefits dropped 14,000 to a seasonally adjusted 218,000 for the week ended September 20, the Labor Department said on Thursday. Economists polled by Reuters had forecast 235,000 claims for the latest week.

Though businesses are hoarding workers, they have remained reluctant to increase headcount as they navigate uncertainty wrought by a protectionist trade policy, which boosted the nation’s average tariff rate to its highest level in a century.

The lackluster demand for workers has eroded the labor market’s resilience, prompting the Federal Reserve to resume cutting i

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