The United States unemployment rate fell to a five-year low of 7% in November, according to the US Labor Department.
Payroll figures also show that 203,000 jobs were created in November, more than predicted, as the US economy displayed encouraging signs of strength. US markets cheered the news, with the Dow Jones industrial average spiking nearly 200 points.
The monthly non-farm payroll figure is watched closely by economists.
Analysts say these indications of strong growth could persuade the Federal Reserve to start unwinding its massive stimulus programme soon.
Outgoing chairman Ben Bernanke has previously said that when the unemployment rate dropped below 7%, the US central bank would end the $US85-billion-a-month bond-buying programme known as quantitative easing.
"When asset purchases ultimately come to an end, the unemployment rate would likely be in the vicinity of 7% percent, with solid economic growth supporting further job gains," he said at a June news conference, though he later scaled back his firm target.
However, the November figure might have been distorted. Some federal workers counted as jobless in October - because of the 16-day partial government shutdown - returned to their jobs last month.