The United States kept up its breakneck pace of hiring in January, adding 257,000 jobs as workers received wage increases unseen since the financial crisis, according to government data released Friday morning.

The unemployment rate ticked up by one-tenth of a point, to 5.7 percent, largely because so many people — nearly 1.1 million — entered the workforce, some coming off the sidelines after years of discouragement.

The latest data indicates a fully firing labor market that has become the engine for the American recovery. The United States has added jobs over the last year at its steadiest pace in two decades, and January offered fresh evidence that employers are now willing to raise wages and compete for workers.

“We’re finally getting to that point where a self-sustaining recovery is going on,” said Jeremy Lawson, chief economist at Standard Life Investments, an asset management firm.

The U.S. labor market has expanded quickly enough in the last year that President Obama recently called 2014 a “breakthrough year in America.” And as it turns out, 2014 just got even better. As part of the latest data from the Department of Labor, net jobs growth figures from November and December were significantly revised upward. November’s net jobs gain now stands at a whopping 423,000, up from the previous 353,000, the biggest one-month gain since 2010. The November through January stretch qualifies as the nation’s best three-month stretch of jobs growth in 17 years.

The monthly jobs data can be volatile, particularly in January, when government economists try to calculate seasonally adjusted hiring growth amid the layoffs of holiday workers. U.S. stocks were up and the dollar strengthened Friday morning on the jobs news, which slightly exceeded market expectations.

Perhaps the best sign in the jobs report wasn't the net payroll gain — the figure has topped 200,000 for 11 months in a row — but rather the nascent sign of rising salaries. The average hourly worker saw a 12-cent-per-hour raise in January, the best one-month increase since 2007. Since the Great Recession, real wages have remained stagnant, but this is slowly beginning to change. Over the last year, wages have risen 2.2 percent. Meantime, consumer prices are seeing inflation below 1 percent, largely because cheaper oil has caused gasoline prices to plummet.

"When I look at this report, I see a confident economy," Department of Labor Secretary Thomas E. Perez said Friday in an interview. "Companies that are bullish. New job-seekers who are more optimistic. And when you factor low gas prices and wage growth, that adds up to money in people’s pockets, a greater hop in their step."

The January wage numbers were being closely watched, because wages had taken a slight step backward in December. Real wages are an important indicator for labor market health, as they rise when more workers leave the sideline and companies feel pressure to compete for employees.

Some economists caution about reading too much into one month’s salary data and say only sustained wage growth will help the country fill one of the missing pieces of the recovery.

“Earnings are increasing, but the rates of real wage growth suggest that more must be done to ensure that all families can feel the strengthening recovery in their own lives,” Jason Furman, chairman of the White House’s Council of Economic Advisers, said in a statement.

For the Federal Reserve, this report offered perhaps the strongest evidence yet encouraging a short-term rate hike in the middle of this year — even as inflation falls below the central bank’s target.

“The pick-up in average hourly earnings gains was a belated Christmas present,” Scott Anderson, chief economist at Bank of the West, said in an e-mail. “It should help the Fed look past a temporary drop in inflation this year and keep their eye on gradually normalizing interest rates.”

In January, jobs growth was broad-based. The health-care and retail sectors were again strong, as they’ve been throughout the recovery. But so, too, were construction (with 39,000 jobs added) and professional and technical services (33,000 jobs added).

For months now, the U.S. economy has looked like the strongest in the developed world. But the recovery here came with a mystery: Some prime-aged workers were sitting on the sideline, unmoved to again begin actively seeking work. That meant they weren’t counted as unemployed. It also left the U.S. economy below its full potential.

January’s data showed at least some evidence that these workers are again looking for work. The labor force participation rate — which tracks the proportion of Americans holding or seeking a job — nudged up from 62.7 to 62.9 percent. That number looks small, but it was caused by a wave of new entrants — some 1.05 million, roughly the population of Rhode Island.

The labor force participation rate is still at its lowest point since the 1970s, but some of that decline is demographic, the result of a retiring wave of baby boomers. The key for the labor force, economists say, is encouraging frustrated middle-aged potential employees to resume their job searches, even if it requires new training or skills.

“There is this drumbeat — we’re seeing more and more jobs in a wide range of different occupations and industries,” said Tara Sinclair, chief economist at, a job search Web site. “Hopefully that will attract these people to get the necessary skills and jobs.”