U.S. President Barack Obama said difficult compromises were needed to move the United States forward in a speech on Wednesday (November 7) after he won a second term in the White House by beating Republican challenger Mitt Romney.

Speaking to supporters in Chicago, Obama pledged to work with Democratic and Republican leaders to cut the federal deficit, fix the tax code, reform immigration and reduce the nation's dependence on foreign oil.

"You elected us to focus on your jobs not ours. And in the coming weeks and months I am looking forward to reaching out and working leaders of both parties to meet the challenges that we can only solve together -- reforming our tax code, fixing our immigration system, freeing ourselves from foreign oil. We've got more work to do," Obama said.

The Democratic administration and lawmakers now have less than two months to deal with massive budget cuts and tax hikes that are set to go into effect at the end of the year, known as the fiscal cliff.

With the U.S. economic recovery at stake, Obama and his Democrats will be forced to put aside partisan differences and work with Republicans to find a way to stave off the austerity measures.

Republicans maintained their majority in the House of Representatives and Democrats kept control of the Senate.

The administration now has a second chance to implement plans to create jobs and reduce the federal debt - issues that voters cited as priorities.

"And whether I earned your vote or not I have listened to you, I have learned from you and I you have made me a better President. And with your stories and your struggles, I return to the White House more determined and more inspired than ever about the work there is to do and the future that lies ahead," Obama said.

The nationwide popular vote remained extremely close with Obama taking about 50 percent to 49 percent for Romney after a campaign in which the candidates and their party allies spent a combined $2 billion.

The president Obama scored impressive victories in the crucial state of Ohio and heavily contested swing states of Virginia, Nevada, Iowa and Colorado. They carried the Democrat past the 270 electoral votes needed for victory in America's state-by-state system of choosing a president, and left Romney's senior advisers shell-shocked at the loss.

Obama, America's first black president, won by convincing voters to stick with him as he tries to reignite strong economic growth and recover from the worst recession since the Great Depression of the 1930s. An uneven recovery has been showing some signs of strength but the country's 7.9 percent jobless rate remains stubbornly high.