Jobless rate falls to 9.4%

NEW YORK (CNNMoney) -- High hopes for December's employment numbers were dashed Friday, when the Labor Department reported disappointing job gains for the month. But the unemployment rate took a surprising dive.

The economy added 103,000 jobs in December -- falling short of most expectations. Meanwhile, the unemployment rate sunk to 9.4%, its lowest level since May 2009, confusing some economists.

While a sharply lower unemployment rate was a welcome surprise, some experts said that drop was mostly due to a shrinking workforce.

"A lower unemployment rate is a mixed blessing," John Silvia, chief economist at Wells Fargo said in a note. "Yes, we are getting more people employed but we appear to be losing people into the woodwork -- not a good sign long term."

Economists surveyed by CNNMoney were expecting the unemployment rate to ease to 9.7%, from 9.8% in the previous month.

The payroll number was a clear disappointment. Economists predicted a gain of 150,000 jobs, and many had boosted their forecasts earlier in the week, after private payroll processor ADP released a shockingly strong report.

While that report is often seen as a bellwether for the Labor Department's number, this is the second month in a row that the government figures came in disappointingly lower.