A report showing strong gains in U.S. employment also showed no progress in reducing long-term joblessness and should steer Washington toward extending unemployment benefits set to expire this year, the White House said on Friday.
The U.S. jobless rate fell to 7 percent last month, a five year low.
But White House economist Jason Furman said the drop was "entirely short-term unemployed finding jobs."
With "just as many long-term unemployed as ever, that's why it's so important to be extending unemployment insurance," Furman told CNBC.
Emergency jobless benefits for 1.3 million long-term unemployed people are set to run out on Jan. 1 unless the U.S. Congress agrees on an extension.