WASHINGTON (AP) - Small businesses and startups that were skittish about the economy this summer started hiring in bigger numbers this fall, helping drive the unemployment rate down to 8.6 percent in November, the lowest in two and a half years.
The country added 120,000 jobs in November, the Labor Department said Friday. The economy has generated 100,000 or more jobs five months in a row - the first time that has happened since April 2006, well before the Great Recession.
"Something good is stirring in the U.S. economy," Ian Shepherdson, an economist at High Frequency Economics, said in a note to clients.
The stock market opened higher after the unemployment report came out. The Dow Jones industrial average climbed 32 points, good for a weekly gain of 820 points. The only bigger point gain in one week was in October 2008.
The report, one of the most closely watched economic indicators, showed that September and October were stronger months than first estimated. For four months in a row, the government has revised job growth figures higher for previous months.
Unemployment was 9 percent in October and has been stuck near or above that level for two and a half years. The last time unemployment was this low was March 2009, two months after President Barack Obama took office.
"Now is not the time to slam the brakes on the recovery, right now it's time to step on the gas," Obama said. He encouraged Congress to extend a tax cut that applies to 160 million Americans but is set to expire at year's end.
The government uses a survey of mostly large companies and government agencies to determine how many jobs were added or lost each month. It uses a separate survey of households to determine the unemployment rate.
The household survey picks up hiring by companies of all sizes, including small businesses and startups. It also includes farm workers and the self-employed, who aren't included in the survey of companies.
The household survey has shown an average of 321,000 jobs created per month since July, compared with an average of 13,000 the first seven months of the year.
When the economy is improving or slipping into recession, many economists say, the household survey does the better job of picking up the shift because it is more likely to detect small business hiring.
"We might finally be seeing new business creation expand again, which is critical to the sustainability of the recovery," said Diane Swonk, chief economist at Mesirow Financial, a financial services company.
The National Federation of Independent Business, a small business group, said Friday that its own survey of small companies shows that more of them are planning to add workers than at any time since September 2008, when the financial crisis struck.