US consumer spending picked up pace in October, despite a dip in income, the Commerce Department reported on Friday. Consumer spending rose 0.3 percent in October, matching the average estimate, accelerating slightly from a 0.2 percent in increase in September. Personal income fell 0.1 percent instead of the 0.3 percent rise expected by most analysts. The October 1-16 partial government shutdown had no impact on government wages and salaries because Congress authorized back pay for federal workers furloughed during the shutdown, the department said.
The US jobless rate fell sharply to 7 percent in November, the lowest level in five years on the creation of a solid 203,000 jobs, the Labor Department announced Friday. The drop in the rate, from 7.3 percent in October, was unexpected and raised the odds that the Federal Reserve could soon begin moving away from its huge stimulus plan. But these gains were mostly due to the return to the rolls of full-time work by hundreds of thousands of government workers laid off temporarily in the first half of October due to washington budget politics, which saw many of them recorded as out of work, according to the Labor Department. That correction to October's distortions also pushed the labor force participation rate back up to 63.0 percent, though that is still very low compared to levels before the 2008 economic crisis.