U.S. unemployment falls to 7% on 203,000 jobs added
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A fourth straight month of solid hiring cut the U.S. unemployment rate in November to a five-year low of 7 percent.
Employers added 203,000 jobs, nearly matching October's revised gain of 200,000, the Labor Department said Friday. The job gains helped lower the unemployment rate from 7.3 percent in October.
Stock investors were heartened by the news, propelling the Dow Jones industrial average up nearly 200 points.
The economy added an average of 204,000 jobs from August through November, up sharply from 159,000 a month from April through July. The robust gain suggested the economy will begin to accelerate. As more employers step up hiring, more people have money to spend to drive the economy.
The job market has shown signs of strengthening at other times since the recession ended 4 ½ years ago, only to weaken and discourage hopes. Some economists say this time, employers may have enough confidence in the economy and consumer demand to step up hiring. A sturdier job market would, in turn, accelerate Americans' spending and energize economic growth.
The report was also encouraging because higher-paying sectors added more jobs. Manufacturers added 27,000 jobs, the most since March 2012. Construction companies added 17,000. The two industries have created a combined 113,000 jobs over the past four months.
"It's hinting very, very strongly that the economy is starting to ramp up, that growth is getting better," said Joel Naroff, president of Naroff Economic Advisors.
The job growth has also fueled speculation that the Federal Reserve will scale back its economic stimulus when it meets later this month.
It "gives the Fed all the evidence it needs to begin tapering its asset purchases" at the next meeting, said Paul Ashworth, an economist at Capital Economics.
The unemployment rate has fallen nearly a full percentage point since the Fed began its current bond-buying program in September 2012 and has reached 7 percent earlier than most analysts expected.
In June, Chairman Ben Bernanke suggested the Fed would end its $85 billion in monthly bond purchases after the unemployment rate reached 7 percent. He later backed away from that target, saying the Fed would weigh numerous economic factors.