The U.S. economy added 192,000 jobs in March, according to government data released Friday morning, a concrete sign that the recovery remains on track despite a slowdown over the winter.
The Labor Department reported that the unemployment rate held steady at 6.7 percent as about half a million people joined the labor force, and the broad-based expansion touched industries ranging from health care to construction. The strong showing is roughly on par with the pace of hiring during the second half of last year, before job creation plunged during an unusually brutal winter. Economists are still debating how much of the weakness was a temporary side effect of the weather. But Friday's data suggested the labor market has thawed with the spring.
“It’s an overall positive report," said Alan MacEachin, corporate economist at Navy Federal Credit Union. “The job market continues to be healthy, not robust.”
MacEachin and many other economists had hoped for an even stronger snapback in March of 200,000 new jobs -- or more. But he said that hiring last month may still have been affected by several late snow storms. MacEachin said he expects businesses to spend the next few months making up lost activity over the winter before hiring returns to its average pace of about 180,000 new jobs.
The report also included another piece of good news: The average workweek edged up by 0.2 hours to 34.5 hours in March. The increase helped offset declines over the past three months that some economists feared signaled fundamental weakness in the labor market. However, average hourly earnings slipped 1 cent to $24.30 in March after spiking 9 cents in February.
"The main takeaway from this report is that the labor market is continuing to bounce out of the weather-induced slump of earlier this year, and while the pace of rebound remains slower than we expected, we take encouragement from the strong showing in almost every other aspect of this report," said Millan L. Mulraine, deputy head of U.S. research and strategy at TD Securities.
U.S. stock markets opened higher on the news, but the three major indexes slid into negative territory by noon. The tech-heavy Nasdaq led the selloff with a 2 percent drop. The blue-chip Dow Jones Industrial Average was down about 0.3 percent, while the broader Standard & Poor's 500-stock index fell more than half a percentage point. Instead, investors sought a safe haven in Treasuries, sending the yield on the 10-year note -- which moves in the opposite direction of price -- down 2 percent to 2.73.
In Washington, the Obama administration used the jobs report to highlight the plight of the long-term unemployed, who account for more than one-third of people out of work. The Senate is expected to vote Monday on a measure that would restore unemployment benefits to those workers. Federal payments to those who have been unemployed six months or more expired in December, and Democrats have been seeking a way to reinstate them.
In a deal brokered by Sens. Jack Reed (D-R.I.) and Dean Heller (R-Nev.), the bill would allow retroactive payments to affected workers. It is expected to pass the Senate but faces a rockier road in the House.
“The challenges confronting the long-term unemployed are the challenges that keep me up the most at night," Labor Secretary Thomas Perez said in an interview Friday. “We’re certainly not going to quit on them.”
March's job gains spanned several key sectors. The professional and business services sector created 57,000 jobs, adding to its rapid expansion. The health care industry and the construction sector each added 19,000 jobs. Though the federal government workforce shrank by 9,000 positions, local jurisdictions added 8,000 jobs, not including those in education.
The government also increased its estimates of job growth in January to 144,000 and in February to 197,000. The revised numbers represent 37,000 more jobs than previously reported for that time period.
The robust hiring in March breathes new life into predictions that 2014 will mark a turning point in the nation's long-simmering economic recovery. Many of the headwinds that had held back growth in previous years have faded: Lawmakers in Washington have reached a deal to fund the government through next year, dispelling the cloud of fiscal uncertainty that had loomed over consumers and businesses since 2011. The financial crisis in Europe has been contained, and the Federal Reserve has begun the anxiously anticipated process of scaling back its support for the economy with relatively little pain. All those factors combined were supposed to set the stage for the recovery to take off.
Instead, many analysts believe the economy grew at a paltry rate of 2 percent or less during the first quarter. (The government's official estimate won't be released until the end of the month.) That threatened forecasts that the economy could expand at a rate of 3 percent this year for the first time in nearly a decade. The solid job growth in March -- if it holds up in future months -- puts that goal back within striking distance.