Unemployment rate falls to 8.5 pct., hiring surges The Labor Department said Friday that employers added a net 200,000 jobs last month and the unemployment rate fell to 8.5 percent, the lowest since February 2009. "There is no question that today's employment report is a positive and there is also no question that the pace of job growth has accelerated of late," said Dan Greenhaus, an analyst at BTIG LLC, a brokerage firm A better job market is a positive sign for President Barack Obama, who is bound to face voters with the highest unemployment rate of any sitting president since World War II. Still, the level may matter less to his re-election chances if the rate continues to fall. The December report painted a picture of a broadly improving job market. Average hourly pay rose, providing consumers with more income to spend. The average work week lengthened, a sign that business is picking up and companies may soon need more workers. And hiring was strong across almost all major industries. Manufacturing added 23,000 jobs, as did the health care industry. Transportation and warehousing added 50,000 jobs. Retailers added 28,000 jobs. Even the beleaguered construction industry added 17,000 workers. More jobs and higher pay are crucial to helping the economy grow. They could enable shoppers to increase spending, which fuels 70 percent of economic activity. The economy likely grew at an annual rate of above 3 percent, a healthy pace. Still, the job market has a long way to go to recover from the Great Recession. The nation has 6 million fewer jobs that it did in December 2007, when the recession began. In addition to the more than 13 million who were unemployed in December, a lot of people can't find full-time work. And many who are unemployed have stopped looking for jobs. The government only counts people as unemployed if they are actively searching for jobs. When including those groups, the broader "underemployment" rate was 15.2 percent. That's down from 15.6 percent the previous month, but still high. The figure has dropped for three straight months. A more robust hiring market coincides with other positive data that show the economy ended the year with some momentum.