Today's jobs report from the Labor Department offered a mixed picture about the economy. The nation's economy added 103,000 jobs in December, fewer than the gain of 150,000 that economists had expected, but the unemployment rate fell to 9.4% from 9.8% last month, the lowest level since May 2009.
The drop in the jobless rate sounds like good news, but the decline was mostly because so many discouraged job seekers dropped out of the workforce. The labor force lost 260,000 adults last month, sending the overall participation rate in the labor force to a 26-year low of 64.3%.
More than 14.5 million people were out of work in December, 44.3% of whom were out of work for 27 weeks or more.
"The big decline in the jobless rate . . . was due to a third consecutive decrease in the labor force, again not a sign that people are seeing their job prospects increase," Steven Ricchiuto, chief economist at Mizuho Securities, told The Wall Street Journal.
The underemployment rate, which includes discouraged workers and people working part-time who would rather have full-time jobs, fell to 16.7% last month from 17% in November.
The unemployment rate has topped 9% since May 2009, the longest stretch since World War II. The employment rate hit a 28-year high of 10.1% in October 2009; it had been below 5% before the recession began.
The Labor Department revised job gains for October and November. October was revised to a gain of 210,000 jobs from an originally reported 172,000, and November added 71,000, up from 39,000.
About 1.1 million jobs were created for all of 2010, the most since 2006. The jobless rate averaged 9.6% last year, the highest since 1983 and up from 9.3% in 2009.
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