2011 unemployment rate ends on an interesting note

Friday, December 23, 2011

The unemployment rate fell to 8.6% last month—the lowest it’s been in two and a half years. In addition, 120,000 new jobs were created and the Dow Jones Industrial average gained 85 points. The report also showed that September and October were stronger months for the job market than first predicted. In September the White House had predicted that a 9.1% unemployment average would close out 2011, and that unemployment would remain at 9% in 2012.

But the monthly unemployment statistics are still fickle and employment estimates are subject to substantial revision. And policymakers are still caught in a bind: A still idle economy decreases tax revenue and increases the deficit, but government initiatives that economists say are needed to jumpstart the economy are costly and would add to the deficit — at least in the near term.

Economists emphasized that there was still a long way to go, but were pleased by this latest batch of statistics. And the really good news? A double-dip recession doesn’t appear to be on the 2012 menu.