US EMPLOYMENT growth accelerated last month and the jobless rate dropped to a near three-year low of 8.5 per cent, offering the strongest evidence yet that the economic recovery was gaining pace.
Non-farm payrolls increased 200,000 in December, the labour department said yesterday. It was the biggest rise in three months and far above economists’ expectations for a 150,000 gain.
The unemployment rate dropped from a revised 8.7 per cent in November to its lowest level since February 2009, a heartening sign for US president Barack Obama, whose re-election hopes could hinge on the state of the labour market.
“While positive, it’s important to contain optimism about the outlook in the months ahead,” said Jim Baird, chief investment strategist for Plante Moran Financial Advisors in Kalamazoo, Michigan. “The economy is still pushing forward, but many hurdles to further acceleration remain.”
A string of better than expected US economic data in recent weeks has highlighted a contrast between the recovery in the world’s biggest economy and Europe, which is already widely believed to be in recession and probably faces worse to come.
Republicans have blasted Mr Obama’s economic policies as doing more harm than good.
The latest economic signs, however, could offer the president some political protection. Over the course of last year, the economy added 1.6 million jobs, the most in five years. Still, at December’s pace of job growth, it would take about2½ years for employment to return to the where it stood before the downturn began. – (Reuters)
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