Employment grew faster than expected in November as the hit from superstorm Sandy on payrolls was less forceful than many feared, Reuters reported.
At the same time, the jobless rate fell to a near four-year low, but that was largely because so many Americans gave up the hunt for work.
Nonfarm employment increased by 146,000 jobs last month, the Labor Department said on Friday, defying expectations of a sharp pull back related to superstorm Sandy.
The government said the storm which slammed the densely populated East Coast had not had a substantive impact on last month’s employment and unemployment estimates.
U.S. financial markets appeared to put more faith in the payroll growth figures, with stock index futures turning positive and prices for US government debt falling.
“The labor market is not getting worse, but is also not getting much better as it is unchanged relative to the recent trend,” said Jacob Oubina, a senior US economist at RBC Capital Markets in New York.
The 0.2 percentage point drop in the unemployment rate to 7.7 per cent — the lowest since December 2008 — represented a drop in both the labor force and employment as measured by a survey of households. Economists generally rely more heavily on the payrolls reading from the separate and much larger survey of employers.
While job gains for both September and October were revised to show 49,000 fewer jobs created than earlier reported, the revision was concentrated in the government sector.
Job gains have averaged 151,000 per month this year, just enough to push the jobless rate lower, but only slowly. Economists say roughly 200,000-250,000 jobs per month are needed to really make headway.
Employment continues to be held back by fears the government may fail to prevent the $600 billion in automatic tax hikes and government spending cuts set to take hold at the start of next year. The debt crisis in Europe has also weighed.
With the pace of job growth still too slow, November’s report is not expected to have much impact on Federal Reserve policymakers, who meet next Tuesday and Wednesday.
Economists said an anticipated tightening of fiscal policy next year, even if a deal is reached to avoid completely going over the “fiscal cliff,” provides ample reason for the U.S. central bank to maintain its ultra-easy monetary policy stance.