Treasury Secretary Jack Lew sounded positive notes about the U.S. economy Thursday morning, saying the nation is starting off 2014 "strong" and facing "economic tailwinds, not headwinds," thanks to falling unemployment and what appears to be progress on fiscal affairs in Congress.

Lew said at an event hosted by the Council on Foreign Relations that over "the arc of the last half year, the trend of economic statistics — job statistics, confidence — it’s been strong, strong across sectors.”

The budget deal reached by congressional negotiators in December "takes away some of the fiscal drag from the economy," Lew said, adding that "macroeconomics matter, and going from policies that push back against economic growth to polices that create economic energy help."

Lew brushed off concerns about weak job growth in December, when the Bureau of Labor Statistics said that only 74,000 jobs were created as hundreds of thousands of Americans dropped out of the labor force. That report was likely just an aberration, Lew said, and the broader trend is clearly toward job growth.

Lew did acknowledge, however, that the declining labor force participation rate, which stood at a decades-low 62.8 percent in December, was a cause for concern. Lew noted that part of the decline could be from college graduates who were unable to find work, and said that the U.S. would have to figure out how to get those young people started in the workforce and how to "take away some of the stigma" associated with long-term unemployment.

Nevertheless, Lew declared that "we ended the year with confidence that the economy is doing better and we start the year with confidence that the economy is getting better."

Other advanced countries, especially in Europe, are lagging the U.S. in recovering from the recession that began five years ago, Lew noted. "We’re now in a growth place that many people envy,” he said, explaining that in terms of percentage points of gross domestic product growth, the U.S. is "in the twos," and "people are talking about whether we’re going to get to three. They’re “trying to get to one.”

Administration officials have consistently overestimated the strength of the recovery over the past five years. Lew did caution that country was "not out of the woods completely" until the number of Americans looking for work fell to a more normal range. And Lew also warned that the looming Feb. 7 deadline for when the debt ceiling would become binding could also harm growth. If Congress does not raise the ceiling, the Treasury could be in danger of missing a payment by late February or early March, Lew said.