The number of Hull workers looking for a job has dropped by 3,586 in the last year.
There are now 8,323 people on Jobseekers Allowance, a 30 per cent fall in the past 12 months, the city's Jobcentre Plus said.
News is also good for young people. 1,180 fewer 18 to 24-year-olds are now claiming, a 36 per cent fall since last November.
Jobcentre employer and partnership manager Gill Dillon said it showed the economy was kicking back into gear.
She said: "It's very pleasing – we're seeing signs the economy is recovering.
"We're generally seeing an increase in vacancies available. We know some of them are part-time and temporary but we're looking forward to things getting better in future.
"The labour market and the economy both seem to be improving now."
In the East Riding, 3,589 people are now claiming out-of-work benefits. That figure has fallen 31 per cent in the last 12 months.
The picture is even better for 18 to 24-year-olds. 965 claimed this month, a 45 per cent drop.
Some people will no longer be seeking payments because they have moved abroad, switched to disability benefits or had their Jobseekers' Allowance withheld for failing to follow the rules.
However, Ms Dillon believes the vast majority have found work.
She said: "The real reason the claimant count is falling is because there are fewer people making claims.
"That is because there are fewer redundancies and people who have got jobs are staying in those jobs.
"It's a very small proportion that are not claiming because they've had their benefits sanctioned."
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