WASHINGTON—The job market may take another four or five years to normalize, Federal Reserve Chairman Ben Bernanke said at a Senate budget hearing Friday morning.
Bernanke said that although November and December saw unemployment insurance claims drop, economic growth is likely to be moderate over the next few quarters and with “employers reportedly still reluctant to add to payrolls, considerable time likely will be required before the unemployment rate has returned to a more normal level.”
The Department of Labor released statistics Friday that show unemployment went down to 9.4 percent in December. This is a drop from 9.8 percent in November 2010 and 9.9 percent in December 2009. The private sector created some 103,000 jobs during December. Labor said employment gains were seen in leisure, hospitality, and health care. The government estimates unemployment won’t hit 8 percent for another two years.
The economic recovery that began mid-2009 is continuing said Bernanke, but at a “pace that has been insufficient to reduce the rate of unemployment significantly.”