While the U.S. economy added 120,000 net new jobs in November and the nation’s unemployment rate fell dramatically, to 8.6 percent, those figures don’t tell the whole story, according to one Washington economist.

The seemingly robust job creation numbers that the federal government released Friday in its monthly employment data still aren’t enough to sustain a real drop in unemployment. Also, the economy would have added another 20,000 jobs in November except that many government workers were laid off — mostly from local governments.

Indeed, the rosy-looking drop in the national unemployment rate isn’t in reality good news at all, says Chad Stone, chief economist at the Center for Budget and Policy Priorities (CBPP), an independent think tank.

“The drop in the unemployment rate to 8.6 percent arises from people leaving the labor force, not from a fundamental improvement in job prospects,” he says.

The labor force shrank by 315,000 people in November, accounting for a substantial share of the decline in the number of unemployed, Stone says.

The economy remains sluggish and “calls for aggressive federal action,” he says.

Congress must renew the emergency unemployment insurance benefits and payroll tax cut that are set to expire at the end of this year, Stone says. Those extensions are caught in Republican obstructionism, however.

Enacting President Obama’s American Jobs Act would be useful because its proposals would boost economic growth and employment significantly in 2012 and 2013, Stone says.

But the economic stimulus with the biggest “bang-for-the buck” would be an extension of unemployment benefits for the nation’s jobless, he adds.

“Letting federal emergency unemployment benefits expire at the end of this year would not only be cruel to unemployed workers and their families, but would also weaken the recovery by reducing their capacity to buy goods and services in an economy that is already suffering from weak aggregate demand,” Stone says.

It remains very difficult to find a job.

The Labor Department’s most comprehensive alternative unemployment rate measure -— which includes people who want to work but are discouraged from looking and people working part time because they can’t find full-time jobs —- was 15.6 percent in November, down only modestly from its all-time high of 17.4 percent in October 2009 in data that go back to 1994, according to Stone. By that measure, over 24 million people are unemployed or underemployed.

More than two-fifths (43 percent) of the 13.3 million people who are unemployed -— 5.7 million people —- have been looking for work for 27 weeks or longer, he says. These long-term unemployed represent 3.7 percent of the labor force. Prior to this recession, the previous highs for these statistics over the past six decades were 26 percent and 2.6 percent, respectively, in June 1983.

“Ideally, Congress would enact a program like the President’s to give the economic recovery an additional boost and increase the likelihood that we can start to see the sustained job growth of 200,000 to 300,000 jobs or more a month to make real progress in reducing the unemployment rate,” Stone says. “At a minimum, lawmakers must not hobble the recovery further by letting the $150 billion of purchasing power –- roughly 1 percent of GDP -– represented by the payroll tax cut and emergency unemployment insurance disappear from households’ budgets, which will occur if they do not renew those programs.

The Obama administration made the same argument Friday.

“”Personal income and consumer spending are both up. Americans are showing more confidence in the economy. Now it’s incumbent upon Washington to give them confidence in our government to solve our biggest challenges and put millions of Americans back to work. This is a strong report, but we can’t forget those Americans who lost their jobs during the recession and are still struggling.

“We know what has worked: extending payroll tax cuts and unemployment insurance, and making smart investments in our economy. The clock is ticking,” says Labor Secretary Hilda Solis. “If Congress doesn’t extend emergency unemployment benefits for our long-term unemployed this month, 5 million Americans will lose their benefits next year. These are the everyday heroes of our recovery who have lost their jobs through no fault of their own. They spend all day, every day filling out applications, sending out resumes and looking for work. Now is not the time to turn our backs on them. They deserve better. They deserve action.

“Congress must act immediately to extend emergency unemployment benefits and payroll tax relief,” Solis adds. “We must pass these measures this month to continue the positive trends we’re seeing in today’s report.”

Scott Nance is the editor and publisher of the news site The Washington Current. He has covered Congress and the federal government for more than a decade.

Rep. Raul Grijalva chaired a hearing Wednesday on job creation. All members of the supercommittee were invited but none decided to attend.

By focusing on deficit reduction, not job creation, the so-called congressional supercommittee is focused entirely on the wrong problems and therefore, the nation would be better off it were to fail to come up with a deal, progressive members of Congress were told Wednesday.

Indeed, the sorts of budget-cutting likely to be recommended by the supercommittee, known formally as the Joint Committee on Deficit Reduction, likely would only worsen the already-bleak U.S. unemployment situation, according to Robert Borosage, co-director of the Campaign for America’s Future, a progressive policy organization.

“For this nation to succeed, the supercommittee must fail,” Borosage says.

Borosage was one of those invited to testify Wednesday at a hearing called by the Congressional Progressive Caucus focusing on job-creation, to which Democrats and Republicans on the supercommittee specifically had been invited. The members of the supercommittee, however, were a no show at the hearing.

The supercommittee is just days away from a deadline to release recommendations for reducing the federal budget deficit by more than $1 trillion over 10 years. It’s still unclear if the panel, evenly split between Democrats and Republicans, will arrive at agreement on a set of recommendations.

“If a drunken bus driver were careening down the wrong road that leads directly off a steep cliff, we would want him to fail. That is exactly the case with the supercommittee,” Borosage says. “They are headed down the wrong road and it will be ruinous if they succeed.

“This is a nation with 26 million people in need of full-time work. Wages are not keeping up with prices,” he adds. “Poverty, now at record levels, is spreading. One in five homes with a mortgage is underwater. Companies are sitting on trillions in profits waiting for customers…We should be having a fierce argument about how to put people to work and get this economy going. … Instead the supercommittee is peddling austerity, pushing Republicans to accept tax hikes — or at least pretend to accept them — and Democrats to embrace cuts in Social Security and Medicare. This is grand folly.

The best deficit-reduction plan would be to put people back to work, Borosage says.

“In fact, America does not have a short-term debt problem,” he says. “If we have a recovery, then our deficits will come down to manageable levels by the end of the decade. If we don’t have a recovery, then austerity will simply make things worse …”

Instead of its current course, the supercommittee should report out –- with its expedited voting powers -– “a bold and sustained jobs proposal,” combining increases in spending on infrastructure, on direct public jobs programs, on aid to states and localities, on mortgage relief for homeowners, with some tax cuts to enlist the support of Republicans, Borosage suggests.

“It would then make the trigger for any turn to austerity not an arbitrary date, but when Americans are going back to work, and unemployment is down to 4 or 5 percent,” he adds.

After the hearing, the co-chair of the Congressional Progressive Caucus lamented the absence of supercommittee members at the jobs hearing.

“Rather than asking the 1% to pay their fair share, the Super Committee is going after the vital programs that make America strong — these cuts would have a drastic impact on the health and financial security of far too many Americans,” Rep. Raul Grijalva (D-Ariz.) says in an email. “… Over the past several months, I have offered constructive recommendations for deficit reduction while stressing the need to put Americans back to work — there are real solutions to our debt crisis that don’t hurt the 99%.”

At this point, Grijalva says he is urging supporters to pressure supercommittee members to take cuts to Medicare and Medicaid off the table.

Scott Nance is the editor and publisher of the news site The Washington Current. He has covered Congress and the federal government for more than a decade.