Unemployment drops to 7 percent in November

Dec 6, 2013 7:56 AM

WASHINGTON (NBC) - The U.S. economy added a better-than-expected 203,000 jobs in November, sending the unemployment rate down to 7 percent, the Bureau of Labor Statistics said on Friday.

Economists had expected the government to report about 180,000 new jobs, down from an initially reported 204,000 in October. The unemployment rate had been expected to decline a notch to 7.2 percent from 7.3 percent.

The positive numbers could pressure the Federal Reserve into easing the throttle on its $85 billion a month on bond purchases known as quantitative easing. The central bank has been watching labor developments closely, looking for stability that could allow it to exit its historically unprecedented easing policy.

Markets initially reacted negatively to the news, with stock market futures shaving earlier gains. Interest rates edged higher, with the benchmark 10-year yield rising to 2.87 percent.

The S&P 500 has been a seven-month winning streak for the day the jobs report is released. Each of those "Jobs Fridays" has seen the report top analyst estimates and has seen the stock market index gain an average of 0.78 percent, according to Bespoke Investment Group.

Investors, though, worry that too much economic growth would spur the Fed into a retreat. The Fed's stimulus policy has helped boost the market more than 160 percent from its March 2009 lows.

Total joblessness fell below 11 million for the first time since November 2008, while total employment swelled by 818,000 as furloughed federal workers went back to work after the government shutdown. The employment rolls had tumbled by 735,000 in October.


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