The unemployment rate took a sharp drop in November, falling to 8.6 percent, which is lowest level since March of 2009.

However, the economy added only 120,00 news jobs last month.

The unemployment rate dropped in part because roughly 315,000 people gave up looking for work and were no longer counted as unemployed.

About 13.3 million Americans remain unemployed.

Ian Shepherdson, an economist at High Frequency Economics, said that burst of hiring by the retail sector is a good sign. It suggests hiring will continue to improve.

"Something good is stirring in the U.S. economy," he said in a note to clients.

But some economists still expect slow growth for the economy.

Paul Ashworth, an economist at Capital Economics, estimates that the economy will expand 2.5 percent in the last three months of this year. But he expects growth to slow to 1.5 percent in 2012, partly because of the crisis in Europe.

He also predicts that if Congress fails to extend the Social Security tax cut and long-term unemployment benefits this month, growth is likely to slow even further.