WASHINGTON - U.S. employers added jobs at a solid pace in March and hired more in January and February than previously thought, and Friday’s government report sent a reassuring signal that the economy withstood a harsh winter that had slowed growth.
The economy gained 192,000 jobs in March, the Labor Department said Friday, slightly below February’s revised total of 197,000. Employers added a combined 37,000 more jobs in January and February than previously estimated.
“This is a very good report,” said Nariman Behravesh, chief economist at IHS Inc. in Lexington, Mass. “It looks like we’re back on track.”
The unemployment rate was unchanged at 6.7 percent. But 500,000 Americans started looking for work last month,and most of them found jobs. The increase in job-seekers is a sign that they were more optimistic about their prospects. If not for the increase in the size of the labor force, the unemployment rate would have fallen to 6.5 percent.
The Labor Department’s survey of households showed about 500,000 people entered the labor force, and almost as many found work. The figures also showed an increase in the number of people employed part-time. The so-called participation rate, which indicates the share of working-age people in the labor force, increased to 63.2 percent from 63 percent a month earlier.
“We’re back to where we were before the weather got bad,” said John Canally, economist at LPL Financial. “It’s a nice, even report that suggests the labor market is expanding.”
March’s gain nearly matched last year’s average monthly total, suggesting that the job market has mostly recovered from the previous months’ severe winter weather.
The March report included one milestone: More than six years after the recession began, private employers have finally regained all the jobs lost to the recession. Businesses and nonprofits shed 8.8 million jobs in the downturn; they’ve since hired 8.9 million. Still, the population has grown over that time, leaving the unemployment rate elevated.
And many of the new jobs pay less than the ones they replaced. Last month, most of the hiring was in lower-paying industries: Temporary help agencies added 28,500 positions, hotels and restaurants added 33,100, and retailers added 21,300.
Higher-paying positions didn’t fare as well. Manufacturers shed 1,000 jobs, the first such drop since July. And professional and technical services, which includes accountants, engineers and information technology workers, added just 10,400.
The proportion of Americans in the labor force - those either working or seeking work - has rebounded this year after steady declines since the recession officially ended in June 2009. Ian Shepherdson, chief economist at Pantheon Macroeconomics, noted that the labor force increased by 1.5 million in the January-March quarter after shrinking by 500,000 last year.
Encouragingly, the percentage of Americans age 16 or older who were working reached 58.9 percent in March - its highest point since 2009.
Many analysts are optimistic that growth will pick up this year after a slow start. The economy likely expanded at just a 1.5 percent to 2 percent annual rate in the first three months of this year. But most economists expect it to rebound in the spring and summer to a 3 percent pace in 2014, which would be the best showing since 2005.
Americans have reduced their debts and benefited from rising home prices and higher stock markets. Their improved finances should translate into more spending.
And a major drag on growth - federal spending cuts and tax increases - will fade this year, likely helping the economy. Budget battles and government shutdowns that have eroded business and consumer confidence since the recession ended are unlikely this year.
Americans worked an average of 34.5 hours last month, up from 34.3 in February, which was held back by the severe weather. The increase, though small, means many Americans received larger weekly paychecks.
Yet average hourly pay slipped a penny to $24.30 after a 10-cent gain in February. That was a disappointment for many economists who thought February’s sharp increase might mark the start of a trend. Average hourly wages have risen 2.1 percent in the past year. Inflation has risen 1.1 percent in that time. In a healthy economy, hourly wages typically grow about 3.5 percent a year.
Information for this article was contributed by Christopher S. Rugaber, Josh Boak and Paul Wiseman of The Associated Press; by Lorraine Woellert, Chris Middleton and Jeanna Smialek of Bloomberg News; and by Nelson D. Schwartz of The New York Times.
Business, Pages 29 on 04/05/2014