US unemployment drops to 6.7 percent
According to data from the US Labor Department, 74,000 new jobs were created in December and US unemployment is at 6.7 percent.
Despite the gain in payrolls, December 2013 was one of the least impressive months for American jobs growth in years.
Job growth is thought to have slowed down because of extreme weather conditions in many parts of the country.
Michael Feroli, chief US economist at JP Morgan Chase & Co., commented on the data, stating that “the weather probably did play a big role.”
He added: “It’s a reminder that the improvement is not going to be a straight line.”
Labor Secretary Thomas E. Perez said that the weak increase comes down to weather conditions as well.
In an interview on CNBC, Perez said: “It’s hard to build a house or build an office building when its 15 to 20 below,” concluding that “weather is undeniably a factor.”
The number of jobs in the construction industry dropped by 16,000 – the first decline in 6 months.
The disappointing figures have caught the attention of politicians, especially as Congress recently failed to extend an emergency federal program for the jobless assistance scheme.
Jason Furman, chairman of the Council of Economic Advisers said in a statement:
“Despite an abundance of evidence indicating that this challenge is far from solved, Congress allowed extended unemployment insurance to lapse at the end of 2013, cutting off a critical lifeline to those who lost a job through no fault of their own and are still searching for work.”
The Council of Economic Advisers has been advising the President of the United States on economic policy since 1946.
Is the US labor market weak?
A recent study carried out by economists at the Economic Policy Institute identified an overall trend revealing that the US labor market remains weak.
The study points out that there are around 5.7 million Americans who are currently not working and are not seeking employment. The unemployment rate would be significantly higher if they were also labeled as jobless workers.