U.S. employers added 74,000 jobs December last year considered to be the lowest in three years, but unemployment rate fell to 6.7 percent due to more Americans stopped looking for work, according to MSN News.
The low count of additional jobs was a disappointing way to end 2013 and it raises questions whether the U.S. job market can sustain its fair gains in the previous months that averaged 214,000 jobs, the report said.
However, economists attributed the slow hiring of companies to the cold weather that hit North America.
The U.S. Labor Department announced last January 3 that the unemployment rate dropped from 7 percent to 6.7 percent in November which is the lowest unemployment drop since October 2008. However, reports said that the unemployment drop was primarily attributed to many Americans who stopped seeking work. It should be noted that in the U.S., once a person stops looking for employment, that person is no longer considered unemployed.
Data suggest that the proportion of people who are either working or looking for work fell to 62.8 percent. Last month, the extension of unemployment benefits for 1.3 million Americans expired. The expiration means that it could accelerate the trend if people stop looking for work, while the unemployment rate would continue to drop.
It's still unclear if the Federal Reserve will rethink its plan to slow its stimulus efforts with the recent sharp hiring slowdown. Last month, the Fed decided to pare its monthly bond purchases designed to lower interest rates and spur borrowing and spending.
"I don't think the Fed is going to be panicked by this," Joel Naroff, president of Naroff Economic Advisors, told MSN News. "It doesn't change what they're thinking."
Economists are requesting to see more data before they can conclude that the economy is slowing down.
"We stop short of making larger observations based on this number," Dan Greenhaus, chief global strategist at brokerage firm BTIG, told MSN News. "The economy, based on any number of other indicators, has been picking up steam of late which makes today's number..curious."
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