The Labour Department said the unemployment rate had fallen from 4.6% in October to 4.4% last month. Employment outside the farm sector climbed 267,000 after a rise of 145,000 in October.

But economists said the figures lessened the chances of further interest rate cuts by Alan Greenspan, head of the US Federal Reserve.

Alan Greenspan might not need to cut interest rates again after these results, say economists

The Labour Department report reflected a robust economy despite a shaky manufacturing sector which has suffered a loss of 108,000 factory jobs since October.

Asian domino effect

The sector has been badly hit by the drying up of export markets around the world because of the slump in Asia.

Katharine Abraham, commissioner of the Labour Department's Bureau of London Statistics, said: "Since its peak in March, manufacturing employment has fallen by 245,999."

But the losses were offset by a burgeoning service industry which has created thousands of jobs in finance and retail sectors.

Seasonal holiday hiring rose at general stores, restaurants and bars while construction employment increased by some 47,000 jobs.

No pressure on pay

Average hourly earnings rose by 0.2%, or just 3 cents, to $12.93. On a yearly basis, average earnings were up 3.7%.

Fred Levin, director of research at Aubrey G.Langston and Co, said: "It's certainly a lot stronger than expected, all across the board. It really says the economy has a lot of momentum and fears of a slowdown are much exaggerated."