The number of new jobs created in September surpassed expectations by about 33,000. Unemployment hits 6-year low

Unemployment fell below 6 percent for the first time in more than six years, dipping to 5.9 percent in September with the economy adding 248,000 jobs, the Labor Department reported on Friday.

The last time unemployment was below 6 percent was in July 2008, when it was 5.8 percent.


The number of new jobs easily surpassed expectations — analysts had predicted 215,000 jobs created last month, according to a Bloomberg survey.

Friday’s robust jobs report comes at an opportune time for the White House as it makes a final push ahead the midterm elections to highlight the economic recovery during the Obama administration. This is the last jobs report before voters go to the polls on Nov. 4.

( Also on POLITICO: President Obama refocuses on economic themes)

“The data underscore that six years after the Great Recession — thanks to the hard work of the American people and in part to the policies the President has pursued — our economy has bounced back more strongly than most others around the world,” Jason Furman, chairman of the White House Council of Economic Advisers, said in a statement.

President Barack Obama delivered a similar message earlier in the week. After stumping for Democratic Illinois Gov. Pat Quinn in Chicago on Thursday, Obama addressed business students at Northwestern’s Kellogg School of Management with a speech that hit on themes like middle-class opportunities, minimum wage and equal pay.

“All told, the United States has put more people back to work than Europe, Japan and every other advanced economy combined,” Obama said. “It is indisputable that our economy is stronger today than when I took office.”

Friday’s report included healthy revisions to the previous months’ payroll figures. The number of jobs gained was revised up from 212,000 to 243,000 for July and from 142,000 to 180,000 for August, for an additional 69,000 jobs in those two months than initially reported. In other positive news, the average weekly hours worked also increased to 34.6 hours.

( POLITICO Pro: Jobs report disappoints)

While the addition of new jobs beat expectations in September, several details of Friday’s data continued to be troubling.

The labor force participation rate — an important measure of the health of the jobs market — dropped from 62.8 percent to 62.7 percent, with 97,000 people leaving the labor force. That means the drop in unemployment can in part be attributed to fewer people looking for jobs.

The number of long-term unemployed — those out of work for 27 weeks or more — was little changed, decreasing by 9,000 since August.

The average hourly earnings also did not improve, ticking down to $24.53 in September from $24.54 in August. Wages have been a persistent weak spot in the U.S. economy and a cause for pessimism among American workers, remaining stagnant even as unemployment has been on a steady decline.

The lack of growth in wages helps explain why voters are not more optimistic about the economy even as other data points paint a brighter picture.

“It is hard to see how the economy will upshift significantly without better earnings and income data,” said Douglas Holtz-Eakin, a Republican economist and president of the American Action Forum.

The White House has repeatedly called on Congress to clear legislation to raise the national minimum wage — an effort that’s been met with resistance from Republicans and business groups.

Republicans have countered by chiding Democrats for not taking up bills passed by the House that the GOP argues would help businesses and, in turn, workers.

Everyday, “I hear from people in my district who say no matter how hard they work, they still struggle to make ends meet,” Speaker John Boehner (R-Ohio) said in a statement on Friday. “Instead of trying to convince Americans that things are great, Washington Democrats ought to show they’re serious about helping middle-class families get ahead, not just get by.”

This latest jobs report is also the final set of monthly employment figures to be released before the Federal Reserve’s policy-setting committee meets later this month, when it is expected to announce the end of the central bank’s asset-purchase stimulus program, known as quantitative easing.

The program, now in its third round, was first implemented at the height of the 2008 financial crisis with the aim of keeping long-term interest rates low to help spark spending and investing. The Fed’s latest round of quantitative easing is down to $15 billion monthly Treasury and mortgage bond purchases. At its peak, the central bank was buying $85 billion in assets each month.

The strength of the labor market and the endurance of the recovery will drive when Fed officials decide to increase short-term interest rates, which have remained near zero since late 2008. Analysts widely believe the first rate hike could take place as early as spring 2015, and stronger-than-expected economic growth and hiring could prompt the Fed to act sooner than anticipated.

“The rebound in U.S. payrolls and further fall in the unemployment rate in September boosts the chances that the Fed will first raise rates in March of next year rather than waiting until June,” Capital Economics senior U.S. economist Paul Dales said in a research note Friday.