* Initial claims drop 14,000 from prior week
* Family Dollar rejects Dollar General buyout offer
* Jackson Hole conference to begin
* Fed's George says time to hike interest rates
* Futures up: Dow 33 pts, S&P 3 pts, Nasdaq 4.25 pts (Adds data, updates prices)
By Chuck Mikolajczak
NEW YORK, Aug 21 U.S. stocks were set for a slightly higher open on Thursday, after jobless claims data pointed to continued improvement in the labor market and before the start of a meeting of top central bankers and economists in Jackson Hole, Wyoming.
* Policymakers are due to discuss the labor markets of major economies at the Aug. 21-23 meeting, with U.S. Federal Reserve Chair Janet Yellen scheduled to speak Friday. Investors will peruse officials' remarks for clues on the timing of an interest rate hike.
* Kansas City Federal Reserve Bank President Esther George told CNBC the time has come for the Federal Reserve to raise interest rates, citing labor market improvements.
* The S&P 500 rose for a third straight day on Wednesday, narrowly missing a record close by less than 2 points, after minutes from the Fed's July meeting led investors to believe the central bank was looking for confirmation in the labor market's recovery before raising rates.
* The first of ,a string of economic data releases on Thursday came in the form of initial jobless claims, which fell to a seasonally adjusted 298,000 last week, a drop of 14,000 from the prior week, and slightly below the 300,000 estimate.
* At 9:45 a.m. (1345 GMT), financial data firm Markit will release its preliminary U.S. Manufacturing Purchasing Managers Index for August. The Thomson Reuters estimate calls for a 55.7 reading versus the prior 55.8 reading in July.
* Shortly after that, at 10:00 a.m. (1400 GMT), existing home sales for July, the Philadelphia Fed business index for August and the Conference Board's gauge of leading economic indicators will be released.
* S&P 500 e-mini futures were up 3 points and fair value - a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract - indicated a modestly higher open. Dow Jones industrial average e-mini futures rose 33 points and Nasdaq 100 e-mini futures added 4.25 points.
* Family Dollar Stores Inc rejected Dollar General Corp's $8.95 billion acquisition offer, citing antitrust concerns, and reaffirmed its support for a buyout offer from Dollar Tree Inc.
* Family Dollar shares shed 0.1 percent to $79.70 and Dollar General lost 1.4 percent to $62.85 in premarket. Dollar Tree also reported quarterly results and shed 1 percent to $54.48.
* Sears Holdings dropped 2.6 percent to $35 in premarket trade after the owner of Sears department stores and the Kmart discount chain reported a ninth straight quarterly loss.
* Earnings are expected from Gap Inc, Salesforce.com and GameStop later on Thursday. (Editing by Bernadette Baum)