This morning’s employment report from the Bureau of Labor Statistics shows the economy added 203,000 jobs in November and the unemployment rate dropped to 7.0 percent. While this is welcome news, it’s important to keep in mind that we still need nearly 8 million jobs to return to pre-recession health in the labor market.

What’s more, while the overall unemployment rate declined, long term unemployment is on the rise. The share of unemployed workers who have been out of work for more than six months increased in November from 36.1 percent to 37.3 percent. Today, the long term unemployment rate is more than double the average rate in 2007. Federal unemployment insurance benefit extensions are set to expire at the end of this month. It would be unprecedented for unemployment insurance benefits to expire at a time when the long term unemployment rate remains so elevated. Further, it is bad policy. If the extensions are allowed to expire, it will immediately cause more than 1.3 million people to lose their unemployment benefits, and millions more will lose their benefits throughout 2014. Not only will this hurt workers, but unemployment insurance is one of the best economic stimulators.

In regard to Federal Reserve policy, today’s numbers should be kept in the larger economic context. We remain almost 8 million jobs away from a healthy labor market, and inflation rates are not only still below conservative targets, they have been decelerating in recent months. Given this, any Federal Reserve shift to a more contractionary monetary policy should remain on hold.