More than a million US citizens face a bleak new year after the government ended their unemployment benefit at the weekend.

The end to the five-year federal programme that extended benefits for the long-term jobless affected 1.3 million people immediately and will impact on hundreds of thousands more who remain jobless in the months ahead.

Under the programme the federal government provided an average monthly payment of $1,166 (£708).

Since 2008 it has paid out benefits to the unemployed after their 26 weeks of state benefits ran out.

At its peak it offered up to 73 weeks of additional federal benefits - which are typically offered during periods of high unemployment - to the long-term jobless.

Although the Obama administration and Democrats in Congress had argued to continue the scheme the extensions were dropped from a compromise budget deal struck earlier this month after Republicans baulked at its $26 billion (£15.8bn) annual cost.

The end of the scheme is likely to prompt an artificial drop in the nation's unemployment rate.

Jobless people are required to look for work in order to receive unemployment benefits.

But as benefits disappear, many of the unemployed will stop looking for work that simply doesn't exist and will no longer be counted as unemployed on the official figures.

The trend has already emerged in North Carolina, which started cutting off extended benefits in July.

The state's unemployment rate went down - from 8.8 per cent in June to 7.4 per cent in November - even though the number of North Carolinians who said they had jobs rose only slightly during that time.

In November the country's overall unemployment rate fell to an official five-year low of 7 per cent, but even that dubious figure is still above the 5 to 6 per cent rate that would signal a "normal" job market in the US.

And long-term unemployment remains a huge problem for the over-stretched economy as nearly 4.1m US workers have been out of a job for six months or more.