U.S. jobless rate reaches 5-year low
WASHINGTON - The job market is showing signs of the consistent gains the nation has awaited in the 4 1/2 years since the Great Recession.
- The job market is showing signs of the consistent gains the nation has awaited in the 4 1/2 years since the Great Recession.
Employers added 203,000 jobs in November, and the unemployment rate fell to 7 percent, a five-year low, the Labor Department reported yesterday. Four straight months of robust hiring have raised hopes that 2014 will be the year the economy returns to normal.
The steady job growth could also hasten a move by the Federal Reserve to reduce its stimulus efforts.
Stock investors were heartened by the report. The Dow Jones industrial average jumped 198 points.
A steadily improving job market could give consumers and business executives the confidence to keep spending and investing, even if a pullback by the Fed leads to higher interest rates. The Fed has been buying bonds each month to try to keep long-term borrowing rates low to spur spending and growth.
The celebration on Wall Street suggested that investors think a healthier job market, if it fuels more spending, would outweigh higher borrowing rates caused by a Fed pullback.
"It's hinting very, very strongly that the economy is starting to ramp up, that growth is getting better, that businesses are hiring," said Joel Naroff, president of Naroff Economic Advisors.
The economy has added a four-month average of 204,000 jobs from August through November, up sharply from 159,000 a month from April through July.
The report did contain some sour notes: Many Americans are still avoiding the job market, neither working nor looking for work. That's one reason the unemployment rate has fallen in recent months. The percentage of adults either working or searching for jobs remains near a 35-year low, at 63 percent.
And America's long-term unemployed are still struggling. More than 4 million people have been out of work for six months or longer. That figure was essentially unchanged in November.