U.S. Unemployment Rate Falls As Economy Adds 200,000 Jobs

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unemployment report december 2011

WASHINGTON -- A burst of hiring in December pushed the unemployment rate to its lowest level in nearly three years, giving the economy a boost at the end of 2011.

The Labor Department said Friday that employers added a net 200,000 jobs last month and the unemployment rate fell to 8.5 percent, the lowest since February 2009. The rate has dropped for four straight months.

The hiring gains cap a six-month stretch in which the economy generated 100,000 jobs or more in each month. That hasn't happened since April 2006.

"There is no question that today's employment report is a positive and there is also no question that the pace of job growth has accelerated of late," said Dan Greenhaus, an analyst at BTIG LLC, a brokerage firm.

A better job market is a positive sign for President Barack Obama, who is bound to face voters with the highest unemployment rate of any sitting president since World War II. Unemployment was 7.8 percent when Obama took office in January 2009.

Still, the level may matter less to his re-election chances if the rate continues to fall. History suggests that presidents' re-election prospects hinge less on the unemployment rate itself than on the rate's direction during the year or two before Election Day.

For all of 2011, the economy added 1.6 million jobs, better than the 940,000 added in 2010. The unemployment rate averaged 8.9 percent last year, down from 9.6 percent the previous year.

Economists forecast that the job gains will top 2.1 million this year.

The December report painted a picture of a broadly improving job market. Average hourly pay rose, providing consumers with more income to spend. The average work week lengthened, a sign that business is picking up and companies may soon need more workers.

Hiring was strong across almost all major industries. Manufacturing added 23,000 jobs, as did the health care industry. Transportation and warehousing added 50,000 jobs. Retailers added 28,000 jobs. Even the beleaguered construction industry added 17,000 workers.

More jobs and higher pay are crucial to helping the economy grow. They could enable shoppers to increase spending, which fuels 70 percent of economic activity.

The economy likely grew at an annual rate of above 3 percent, a healthy pace.

Still, the job market has a long way to go to recover from the Great Recession. The nation has 6 million fewer jobs that it did in December 2007, when the recession began.

In addition to the more than 13 million who were unemployed in December, a lot of people can't find full-time work. And many who are unemployed have stopped looking for jobs. The government only counts people as unemployed if they are actively searching for jobs.

When including those groups, the broader "underemployment" rate was 15.2 percent. That's down from 15.6 percent the previous month, but still high. The figure has dropped for three straight months.

A more robust hiring market coincides with other positive data that show the economy ended the year with some momentum.

Weekly applications for unemployment benefits have fallen to levels last seen more than three years ago. Holiday sales were solid. And November and December were the strongest months of 2011 for U.S. auto sales.

Many businesses say they are ready to step up hiring in early 2012 after seeing stronger consumer confidence and greater demand for their products.


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Summer

Of course there were more jobs the Holidays helped, Now is when the job market gets bad again.

January 06 2012 at 4:19 PM Report abuse +3 rate up rate down Reply
1 reply to Summer's comment
sfields435

Last December UE was 9.4%...same Holidays folks....

Gee, you'd think good news was upsetting to you American Patriots.

January 06 2012 at 6:41 PM Report abuse -1 rate up rate down Reply
ANDIKA7

Those are all seasonal jobs. Besides, nobody talks about those millions of unemployed college grads that cannot file for unemployment.

January 06 2012 at 3:21 PM Report abuse +2 rate up rate down Reply
belldn3

Things are working out, slowly, but it's happening.

January 06 2012 at 3:17 PM Report abuse -1 rate up rate down Reply
kramerdad1

Sad really sad, there is no media any more, they have all stopped being journalists and now just repeat what ever they get without ever investigating or questioning the truth of the matter. reporting unemployment as having decreased is an out right lie, any "reporter" who was interested in the truth would be publishing the fact that obama has reduced the universe of jobs therefor reducing the unemployment number through vodoo book keeping. you can report 8.5 unemployment instead of the 15-18% it really is when you eliminate 2 million jobs from the equation and stop counting those who have given up looking for work. sad, the media used to be our last line of defense againt this sort of bs, now they are actively engaging in it.

January 06 2012 at 2:55 PM Report abuse +1 rate up rate down Reply
Cas

Higher Pay if you work for the White House, Congress or the Senate.

January 06 2012 at 2:42 PM Report abuse rate up rate down Reply
sfields435

These UE #'s are calculated EXACTLY as they have been for EVERY President; So they are "real".

Reagan inherited UE of 7.5%; it stood @ 10.8% in Dec of his 2nd yr....and @ 8.3% by Dec of his 3rd

Obama inherited UE of 7.6%: it stood @ 9.4% in Dec of his 2nd yr...and @8.5% by Dec of his 3rd

Reagan didn't inherit "the worst economic crisis since the Great Depression", the expense of 2 wars,
or a $10.6 Trillion Debt + $ 280 Billion in annual interest. But, Obama did.

Yet, the GOP tells us that Reagan is the Great Hero...and Obama the President w/ "failed policies".

OH...and, to pull the nation out of recession, Reagan increased the Nat'l Debt by 189% [ w/ his tax cuts & massive increases in defense spending]. Obama has increased it 41%. [Bush Jr increased in 89%].

January 06 2012 at 2:37 PM Report abuse rate up rate down Reply
3 replies to sfields435's comment
madkono

the actual rate, is closer 25%!!! but too many people will believe, what the government wants them to think!!!

January 06 2012 at 2:15 PM Report abuse +2 rate up rate down Reply
2 replies to madkono's comment
sfields435

This is "the actual rate". It is calculated the same way "the rate" has been calculated for every REPUBLICAN President.

January 06 2012 at 2:30 PM Report abuse -1 rate up rate down Reply
1 reply to sfields435's comment
magicgary1960

This Is not the actual rate there Is around 20 Million Americans out of work try more like 20% unemployment the real rate.

January 06 2012 at 4:33 PM Report abuse +1 rate up rate down
sfields435

This is the "actual rate". It been calculated the same way it was for every GOP President.

January 06 2012 at 2:31 PM Report abuse -1 rate up rate down Reply
1 reply to sfields435's comment
Welcome MSGT

"The real US unemployment rate is 16 percent if persons who have dropped out of the labor pool and those working less than they would like are counted, a Federal Reserve official said Wednesday.
"If one considers the people who would like a job but have stopped looking -- so-called discouraged workers -- and those who are working fewer hours than they want, the unemployment rate would move from the official 9.4 percent to 16 percent, said Atlanta Fed chief Dennis Lockhart".

January 06 2012 at 3:07 PM Report abuse +1 rate up rate down
quadia

First, unemployment rates always fall in the October to December holiday period. Secondly, I'd like to see a comparison of the number of permanent jobs added to the number of jobs lost or sent overseas. That would give a more accurate employment/unemployment rate. Additionally, the 8.5% average is just that, as there are places (my state included) where the jobless rate is up to 12%. (Granted, there may be other areas of the country where the jobless rate falls below 8.5% which is how averages are figured.) I would also like to see a state-by-state unemployment rate given so a truer picture of the state of the economy can be shown. None of that will happen, of course, because it paints the unemployment picture much more bleak than the national average would have us believe.

January 06 2012 at 2:11 PM Report abuse rate up rate down Reply
Steve

This would be ok news, if it were based on truth, unfortunately it is not. Actual unemployment rate around 11%, if you count all of the actual unemployed. Unemployment of negroes is at 16%, but they will be celebrating the most. Sad state of affairs.

January 06 2012 at 2:10 PM Report abuse rate up rate down Reply
firefighterghg

WOW, UNEMPLOYMENT WAY WAY DOWN, SOCIAL SECURITY RAISES, CIVIL SERVICE RAISES, GAS PRICES DOWN. WOW, OBAMA IS A ONE MAN WRECKING CREW AINT HE SOMETHING? I SAY TWO TERMS FOR BARRY OBAMA. ONE IN OFFICE AND ONE IN JAIL HAHAHAHA. WORST PRESIDENT EVER

January 06 2012 at 2:04 PM Report abuse +3 rate up rate down Reply

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