The_AT Unemployment_NN1 Rate_NN1 Drops_NN2 ,_, but_CCB Economists_NN2 Are_VBR n't_XX Smiling_VVG The_AT U.S._NP1 unemployment_NN1 rate_NN1 lurched_VVD downward_RL in_II November_NPM1 to_II 8.6_MC percent_NNU ,_, from_II 9_MC percent_NNU in_II October_NPM1 ._. 
That_DD1 's_VBZ the_AT lowest_JJT level_NN1 since_II March_NPM1 2009_MC ,_, and_CC it_PPH1 emboldened_VVD some_DD optimists_NN2 to_TO predict_VVI the_AT U.S._NP1 could_VM be_VBI back_RP near_II full_JJ employment_NN1 within_II a_AT1 couple_NN1 of_IO years_NNT2 ._. 
Pessimists_NN2 ,_, on_II the_AT other_JJ hand_NN1 ,_, say_VV0 the_AT jobless_JJ rate_NN1 will_VM rise_VVI between_II now_RT and_CC 2013_MC ._. 
The_AT consensus_NN1 view_NN1 is_VBZ pretty_RG bearish_JJ ,_, too_RR ._. 
The_AT median_JJ forecast_NN1 of_IO economists_NN2 is_VBZ for_IF scarcely_RR any_DD decrease_NN1 in_II the_AT unemployment_NN1 rate_NN1 over_II the_AT next_MD two_MC years_NNT2 ._. 
Economists_NN2 disagree_VV0 on_II the_AT job_NN1 question_NN1 because_CS they_PPHS2 entertain_VV0 different_JJ scenarios_NN2 for_IF the_AT factors_NN2 that_CST affect_VV0 it_PPH1 ._. 
Those_DD2 include_VV0 the_AT underlying_JJ health_NN1 of_IO the_AT U.S._NP1 economy_NN1 ,_, spillover_VV0 from_II Europe_NP1 's_GE financial_JJ crisis_NN1 ,_, fiscal_JJ policy_NN1 in_II Washington_NP1 ,_, and_CC swings_VVZ in_II the_AT labor-force_JJ participation_NN1 rate_NN1 ._. 
James_NP1 F._NP1 Smith_NP1 sees_VVZ blue_JJ skies_NN2 ahead_RL ._. 
The_AT chief_JJ economist_NN1 of_IO Parsec_NP1 Financial_NP1 Management_NN1 ,_, a_AT1 wealth-management_JJ firm_NN1 in_II Asheville_NP1 ,_, N.C._NP1 ,_, thinks_VVZ the_AT jobless_JJ rate_NN1 will_VM average_VVI 7.8_MC percent_NNU in_II 2012_MC and_CC 6.4_MC percent_NNU in_II 2013_MC ._. 
That_DD1 latter_DA number_NN1 is_VBZ close_JJ to_II full_JJ employment_NN1 ,_, estimated_VVN at_II 5_MC percent_NNU to_II 6_MC percent_NNU --_NN1 the_AT lowest_JJT the_AT jobless_JJ rate_NN1 can_VM go_VVI before_II wage_NN1 inflation_NN1 heats_NN2 up_RP ._. 
Smith_NP1 predicts_VVZ the_AT economy_NN1 will_VM grow_VVI 3.9_MC percent_NNU next_MD year_NNT1 and_CC 4.5_MC percent_NNU in_II 2013_MC ._. 
Companies_NN2 are_VBR about_RPK to_TO go_VVI on_II an_AT1 investing_JJ and_CC hiring_VVG binge_NN1 ,_, Smith_NP1 says_VVZ ,_, because_CS "_" if_CS you_PPY want_VV0 to_TO stay_VVI competitive_JJ you_PPY must_VM have_VHI the_AT latest_JJT ,_, greatest_JJT equipment_NN1 and_CC also_RR the_AT best_JJT ,_, brightest_JJT people_NN ._. "_" 
High_JJ household_NN1 debt_NN1 does_VDZ n't_XX worry_VVI Smith_NP1 because_CS "_" increasing_JJ employment_NN1 will_VM raise_VVI incomes_NN2 and_CC allow_VVI for_IF both_RR consumption_NN1 and_CC savings_NN2 to_TO increase_VVI ._. "_" 
He_PPHS1 's_VBZ optimistic_JJ on_II housing_NN1 ,_, too_RR ._. 
Bolstering_VVG that_DD1 view_NN1 ,_, Goldman_NP1 Sachs_NP1 (_( GS_NP1 )_) economists_NN2 said_VVD on_II Dec._NPM1 2_MC that_DD1 home_NN1 prices_NN2 will_VM probably_RR hit_VVI bottom_JJ next_MD summer_NNT1 ._. 
In_II another_DD1 positive_JJ sign_NN1 ,_, on_II Dec._NPM1 1_MC1 the_AT Institute_NN1 for_IF Supply_NN1 Management_NN1 reported_VVD a_AT1 nice_JJ gain_NN1 in_II its_APPGE November_NPM1 manufacturing_NN1 index_NN1 ._. 
At_II the_AT darker_JJR end_NN1 of_IO the_AT range_NN1 is_VBZ John_NP1 E._NP1 Silvia_NP1 ,_, chief_JJ economist_NN1 of_IO Wells_NP1 Fargo_NP1 Securities_NN2 in_II Charlotte_NP1 ._. 
He_PPHS1 predicts_VVZ a_AT1 jobless_JJ rate_NN1 of_IO 9.2_MC percent_NNU in_II 2012_MC and_CC 9_MC percent_NNU in_II 2013_MC ._. 
Silvia_NN1 worries_VVZ more_DAR than_CSN Smith_NP1 about_II contagion_NN1 from_II Europe_NP1 ,_, mostly_RR via_II the_AT intertwined_JJ financial_JJ systems_NN2 of_IO the_AT two_MC regions_NN2 ._. 
Although_CS he_PPHS1 favors_VVZ more_RGR fiscal_JJ rectitude_NN1 in_II Washington_NP1 ,_, he_PPHS1 's_VBZ concerned_JJ that_CST the_AT short-run_JJ effect_NN1 of_IO deficit_NN1 reduction_NN1 will_VM be_VBI to_TO suppress_VVI demand_NN1 and_CC thus_RR growth_NN1 ._. 
Worse_JJR for_IF workers_NN2 ,_, Silvia_NP1 says_VVZ ,_, companies_NN2 are_VBR getting_VVG better_RRR at_II expanding_JJ output_NN1 without_IW hiring_NN1 ._. 
"_" We_PPIS2 're_VBR adding_VVG a_RR21 lot_RR22 more_RGR capital_JJ than_CSN labor_NN1 to_TO produce_VVI ,_, and_CC we_PPIS2 're_VBR changing_VVG what_DDQ we_PPIS2 produce_VV0 ,_, "_" he_PPHS1 says_VVZ ._. 
"_" That_DD1 's_VBZ a_AT1 challenge_NN1 for_IF our_APPGE society_NN1 ._. "_" 
Many_DA2 economists_NN2 also_RR continue_VV0 to_TO worry_VVI about_II the_AT drag_VV0 from_II household_NN1 debt_NN1 ._. 
Last_MD January_NPM1 in_II Denver_NP1 ,_, Stanford_NP1 University_NN1 economist_NN1 Robert_NP1 E._NP1 Hall_NN1 gave_VVD an_AT1 address_NN1 at_II the_AT annual_JJ meeting_NN1 of_IO the_AT American_JJ Economic_JJ Assn._NP1 in_II which_DDQ he_PPHS1 attributed_VVD the_AT sluggish_JJ recovery_NN1 to_II consumers_NN2 '_GE indebtedness_NN1 ,_, which_DDQ limits_VVZ their_APPGE spending_NN1 power_NN1 ,_, giving_VVG companies_NN2 little_JJ reason_NN1 to_TO hire_VVI ._. 
"_" I_PPIS1 'm_VBM not_XX a_AT1 forecaster_NN1 ,_, "_" Hall_NN1 says_VVZ now_RT ,_, "_" but_CCB I_PPIS1 have_VH0 no_AT reason_NN1 to_TO disagree_VVI with_IW the_AT consensus_NN1 forecast_NN1 of_IO unemployment_NN1 not_XX reaching_VVG 6_MC percent_NNU until_CS late_RR in_II the_AT decade_NNT1 ._. "_" 
Most_DAT likely_JJ the_AT jobless_JJ rate_NN1 will_VM fall_VVI somewhere_RL between_II Smith_NP1 's_GE bullish_JJ and_CC Silvia_NP1 's_GE bearish_JJ forecast_NN1 ._. 
The_AT median_NN1 of_IO the_AT 57_MC forecasts_NN2 in_II a_AT1 Bloomberg_NP1 News_NN1 survey_NN1 is_VBZ an_AT1 average_JJ unemployment_NN1 rate_NN1 of_IO 8.8_MC percent_NNU in_II 2012_MC and_CC 8.3_MC percent_NNU in_II 2013_MC ._. 
That_DD1 's_VBZ premised_VVN on_II gross_JJ domestic_JJ product_NN1 growth_NN1 of_IO 2.2_MC percent_NNU next_MD year_NNT1 and_CC 2.5_MC percent_NNU in_II 2013_MC --_JJ not_XX the_AT robust_JJ numbers_NN2 needed_VVN to_TO bring_VVI joblessness_NN1 down_RP rapidly_RR ._. 
A_AT1 big_JJ drop_NN1 in_II the_AT jobless_JJ rate_NN1 is_VBZ n't_XX always_RR good_JJ news_NN1 ._. 
A_RR21 lot_RR22 depends_VVZ on_II what_DDQ causes_VVZ the_AT drop_NN1 ._. 
Remember_VV0 ,_, the_AT unemployment_NN1 rate_NN1 is_VBZ calculated_VVN by_II adding_VVG up_RP all_DB the_AT people_NN who_PNQS tell_VV0 government_NN1 surveyors_NN2 that_CST they_PPHS2 ca_VM n't_XX find_VVI work_NN1 and_CC dividing_VVG it_PPH1 by_II all_DB the_AT people_NN in_II the_AT labor_NN1 force_NN1 --_NN1 those_DD2 either_RR employed_VVN or_CC actively_RR looking_VVG ._. 
So_RR if_CS people_NN give_VV0 up_RP searching_VVG ,_, they_PPHS2 're_VBR no_RR21 longer_RR22 counted_VVN as_CSA unemployed_JJ ,_, and_CC the_AT rate_NN1 falls_NN2 ._. 
In_II November_NPM1 about_II two-thirds_MF of_IO the_AT improvement_NN1 in_II the_AT jobless_JJ rate_NN1 came_VVD from_II people_NN dropping_VVG out_II21 of_II22 the_AT labor_NN1 force_NN1 and_CC thus_RR out_II21 of_II22 the_AT calculation_NN1 of_IO the_AT unemployed_JJ ._. 
Only_RR one-third_MF was_VBDZ because_II21 of_II22 actual_JJ job_NN1 creation_NN1 ._. 
What_DDQ makes_VVZ unemployment_NN1 so_RG hard_JJ to_TO bring_VVI down_RP is_VBZ that_DD1 new_JJ people_NN keep_VV0 entering_VVG the_AT labor_NN1 force_NN1 ,_, while_CS the_AT productivity_NN1 of_IO those_DD2 already_RR working_VVG goes_VVZ up_RP ,_, lessening_VVG the_AT need_NN1 for_IF new_JJ hires_NN2 ._. 
To_TO lower_VVI the_AT jobless_JJ rate_NN1 ,_, the_AT economy_NN1 has_VHZ to_TO grow_VVI fast_RR enough_RR to_TO overcome_VVI the_AT triple_JJ challenges_NN2 of_IO rising_VVG productivity_NN1 ,_, a_AT1 growing_JJ population_NN1 ,_, and_CC the_AT reentry_NN1 of_IO workers_NN2 into_II the_AT labor_NN1 force_NN1 as_CSA business_NN1 conditions_NN2 improve_VV0 and_CC they_PPHS2 see_VV0 hiring_VVG prospects_NN2 get_VV0 better_RRR ,_, notes_VVZ Michael_NP1 R._NP1 Englund_NP1 ,_, chief_JJ economist_NN1 at_II Action_NN1 Economics_NN1 in_II Boulder_NP1 ,_, Colo_NP1 ._. 
Since_CS December_NPM1 2007_MC the_AT U.S._NP1 population_NN1 has_VHZ increased_VVN by_II a_RR21 little_RR22 more_DAR than_CSN 3_MC percent_NNU ,_, while_CS the_AT labor_NN1 force_NN1 has_VHZ decreased_VVN by_RP about_II 50,000_MC workers_NN2 (_( chart_NN1 )_) ._. 
This_DD1 is_VBZ the_AT longest_JJT it_PPH1 has_VHZ taken_VVN for_IF the_AT labor_NN1 force_NN1 to_TO regain_VVI its_APPGE pre-recession_JJ high_JJ since_CS the_AT Bureau_NN1 of_IO Labor_NN1 Statistics_NN began_VVD keeping_VVG records_NN2 in_II 1948_MC ._. 
According_II21 to_II22 a_AT1 back-of-the-envelope_JJ calculation_NN1 ,_, if_CS the_AT labor_NN1 force_NN1 had_VHD grown_VVN at_II its_APPGE usual_JJ pace_NN1 instead_II21 of_II22 shrinking_NN1 ,_, then_RT all_DB else_RR being_VBG equal_JJ ,_, the_AT November_NPM1 unemployment_NN1 rate_NN1 would_VM have_VHI been_VBN 11.4_MC percent_NNU rather_II21 than_II22 8.6_MC percent_NNU ._. 
A_AT1 healthy_JJ job_NN1 market_NN1 is_VBZ still_RR a_AT1 long_JJ way_NN1 off_RP ._. 
