US unemployment drops to 5-year low

U.S. employers hired more workers than expected in November, cutting the unemployment rate to a five-year low of 7 percent, down from 7.3 percent in October, the Labor Department said on Friday.

The Bureau of Labor Statistics jobs report for November said employers added 203,000 jobs, surpassing October's revised gain of 200,000. The U.S. economy has now added jobs for 45 straight months.

The economy generated an average of 204,000 jobs each month from August through November, despite a 15-day government shutdown in October that furloughed 800,000 federal employees. That monthly average is up from the 159,000 per month added from April through July.

"Today’s report was yet another reminder of the resilience of America’s private sector following the disruptive government shutdown and debt limit brinkmanship in the first half of October," said Jason Furman, chairman of the Council of Economic Advisers, in a statement. But he added that the 7 percent unemployment rate — 11 million people — is "still unacceptably high."

The jobs report also pointed to divergent trajectories for short-term and long-term unemployment: Whereas it found a drop in short-term unemployment, the average duration of unemployment is actually on the rise.

David Blanchflower, a professor of economics at Dartmouth College, said that overall the jobs report was "very solid" but that there was "still little sign of wage growth."

On Friday, the Commerce Department reported growth in U.S. consumer spending in October even though wages and salaries barely increased.

Consumer spending ticked upward by 0.3 percent in October; in September it had risen 0.2 percent. But wages and salaries saw only a slight increase of 0.1 percent, after a much stronger 1 percent rise in September.

Many of the November job gains were in higher-paying industries, the Bureau of Labor Statistics said.

Professional and business services added 35,000 jobs. The federal government, meanwhile, continued to cut jobs, but state and local governments picked up the slack with 14,000 new hires.

Al Jazeera with wire services