U.S. job market shows resilience despite budget fight
The U.S. job market showed resilience in three reports Thursday, suggesting it may able to withstand a federal budget battle that threatens more economic uncertainty in coming months.
Some economists saw potential for stronger gains based on Thursday's data. Joseph LaVorgna, chief U.S. economist at Deutsche Bank, raised his forecast for job growth to 190,000 jobs, from 150,000. Credit Suisse increased its forecast to 185,000, from 165,000.
Still, many economists remained cautious about where the job market is headed. While Congress and the White House reached a deal this week that removed the threat of tax increases to most Americans, they postponed the more difficult decisions on cutting spending. And the government must also increase its $16.4 trillion borrowing limit by late February or risk defaulting on its debt.
Congressional Republicans are pressing for deep spending cuts in return for any increase in the borrowing limit. President Barack Obama has repeatedly said he wants the issues kept separate.
Even with modest gains in hiring, the unemployment rate remains high. It fell to 7.7 percent in November from 7.9 percent in October, mostly because many of the unemployed stopped looking for jobs.
The number of people receiving jobless benefits fell to 5.4 million in the week ended Dec. 15, the latest data available. That's down about 70,000 from the previous week. The figure includes about 2.1 million people receiving emergency benefits paid for by the federal government. The White House and Congress agreed earlier this week to extend that program for another year.