Though U.S. employment rose less than expected in October, when coupled with upward revisions to prior months’ job gains, it was enough to effect a drop in the unemployment rate, which last month reached a six-month low of 9.0%.
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Non-farm payrolls rose 80,000 last month, according to a Labor Department report issued Friday, missing economists’ expectations for a gain of 95,000. However, figures for both August and September were revised to show that 102,000 more jobs were created than previously reported.
The report suggests that the economy is gaining momentum, and that there is underlying strength in the labor market, though the progress of putting 13.9 million unemployed Americans back to work has been slower than expected when the recession “officially” ended in 2009.
Still, despite a seemingly positive employment trend, the U.S. Federal Reserve on Wednesday lowered its growth forecasts and raised its projections for unemployment in 2012.
Europe’s debt crisis still threatens to derail the recovery, riling global financial markets and pushing consumer confidence to recessionary levels.
The Obama administration has been struggling to push through legislation that would help create jobs, meeting with strong opposition from Republicans, who took control of the House of Representatives in the 2010 elections.
To prevent unemployment from rising, the economy needs to expand at an annual rate of 2.5% over a sustained period of time and consistently add roughly 125,000 jobs a month.
Growth during the third quarter accelerated to a 2.5% rate, but was preceded in the second with by 1.3% rate.
The private sector added 104,000 jobs last month, offsetting a 24,000 drop in government payrolls. Public employment has fallen off nearly every month this year as state and local governments grapple with budget cuts.