WASHINGTON — A surprising drop in the November unemployment rate and in job losses cheered investors Friday and raised hopes for a sustained economic recovery. The rate unexpectedly fell to 10 percent last month, from 10.2 percent in October, as employers cut the fewest number of jobs since the recession began. The better-than-expected figures provided a rare dose of good news for a labor market that’s lost 7.2 million jobs in two years.
The average work week also rose, along with average earnings. And the Labor Department said 159,000 fewer jobs were lost in September and October than first reported.
The stock market jumped and Treasurys fell in response to the reports. In midmorning trading, the Dow Jones industrial average surged 110.94, or 1.1 percent. Broader stock averages also rose.
Still, the respite may be temporary. Job creation is expected to remain far too weak in coming months to absorb the 15.4 million unemployed people who are seeking work – and 11.5 million others who are either working part-time but want full-time jobs or have given up job hunting. As more people begin seeking work, the jobless rate is likely to resume rising.
The report offered further evidence of how hard it remains to find employment: The number of people jobless for at least six months rose last month to 5.9 million, and the average length of unemployment rose to more than 28 weeks.
"We will need very substantial job growth to get unemployment lower, especially when the labor force … starts growing again," said Lawrence Mishel, president of the Economic Policy Institute, a liberal think tank.
The economy shed 11,000 jobs last month, an improvement from October’s revised total of 111,000, the Labor Department said Friday. That’s much better than the 130,000 Wall Street economists had expected. [CONTINUED]
