The US jobless rate fell sharply to seven per cent in November, the lowest level in five years on the creation of a solid 203,000 jobs, the Labor Department says.

The drop in the rate, from 7.3 per cent in October, was unexpected and raised the odds that the Federal Reserve could soon begin moving away from its huge stimulus plan.

The number of jobs created was also better than expected, 3,000 more than October’s adjusted figure and up from a revised 175,000 in September, with the gains spread over the manufacturing, retail trade, health and professional service sectors.

The number of unemployed Americans fell by 365,000 to 10.9 million, and total employment numbers surged.

But these gains were mostly due to the return to the rolls of full-time work by hundreds of thousands of government workers laid off temporarily in the first half of October due to washington budget politics, which saw many of them recorded as out of work, according to the Labor Department.

That correction to October’s distortions also pushed the labour force participation rate back up to 63.0 per cent, though that is still very low compared to levels before the 2008 economic crisis.

Even so, there were other signs of overall strength: government authorities were net hirers; the number of people working part-time also declined, by 331,000; the number of long-term unemployed was stable; and weekly hours and wages both ticked up slightly.

Analysts said the data could push Federal Reserve policy-makers, who have been looking for greater signs of strength in the jobs market, to begin cutting their stimulus program for the economy.

“This week’s data therefore add to the sense that the Fed will be itching to pull the trigger to take the first shot at killing off its huge $US85 billion ($A93.8 billion) per month asset-purchase program at its December meeting,” said Chris Williamson of economic analysts Markit.

However, he predicted, the Fed would wait at least one more month to see the gains confirmed.