U.S. employers added jobs at a solid pace in March and hired more in January and February than previously thought. 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.
The unemployment rate was unchanged at 6.7 percent. But a half-million 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.
“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 job gain nearly matched last year's average monthly total, suggesting that the job market has mostly recovered from the previous months' severe winter weather.
Stocks fell in afternoon trading, and the yield on the 10-year Treasury note fell to 2.75 percent from 2.8 percent late Thursday.
The March report included one milestone: More than six years after the Great 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 boosting the economy. Budget battles and government shutdowns that have eroded business and consumer confidence since the recession ended are unlikely this year.
The greater stability in Washington has helped business grow for Advanced Technology Services, a Peoria, Ill.-based company that maintains machine tools, robotics, and computer systems for industrial companies such as Caterpillar, Honeywell, and Honda.
The company has about 120 job openings for factory floor technicians, network engineers and information technology professionals. It has 2,700 employees in the United States and 300 more in Mexico and the United Kingdom.
Jeff Owens, president of ATS, said the company's clients appear more confident about economic growth and more willing to invest in machinery. He's seeing solid growth in the automotive, food processing and oil and gas drilling equipment industries.
“The economy is better than it was a year or two ago,” Owens said. “We're seeing that people are more comfortable with executing their strategic plans.”
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 big 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.
Freezing temperatures and heavy snowstorms this winter closed factories, slowed home sales and kept consumers away from shopping malls. Hiring averaged 178,000 in the first three months of this year, down from 198,000 a month in the final three months of 2013.
Still, many economists expect hiring to average about 200,000 jobs a month for the rest of the year. Hiring at that pace should lower the unemployment rate and support steady growth.
Other recent economic data suggest that the economy is picking up from the winter freeze. Auto sales, for example, jumped 6 percent last month to 1.5 million, the most since November. That was a sign that Americans remain willing to spend on big purchases.