Employment in the U.S. rose by much less than anticipated in the month of March, according to a report released by the Labor Department on Friday, although the unemployment rate still fell to its lowest level in almost ten years.
The report said non-farm payroll employment climbed by 98,000 jobs in March after surging up by a revised 219,000 jobs in February.
Economists had expected an increase of about 180,000 jobs compared to the jump of 235,000 jobs originally reported for the previous month.
The Labor Department highlighted job growth in the professional and business services and mining sectors, which added 56,000 jobs and 11,000 jobs, respectively.
On the other hand, the report showed a continued job in employment in the retail sector, which lost 29,700 jobs in March after a drop of 30,900 jobs in February.
A notable slowdown in the pace of job growth in the construction sector also contributed to the smaller than expected increase in employment, as the construction sector added just 6,000 jobs in March.
Despite the weaker than expected job growth, the unemployment rate fell to 4.5 percent in March from 4.7 percent in February. The unemployment rate had been expected to come in unchanged.
With the unexpected decrease, the unemployment rate fell to its lowest level since hitting 4.4 percent in May of 2007.
The drop in unemployment rate came as the household survey of employment showed an increase of 472,000 people, while the labor force increased by just 145,000 people.
ING Senior Economist James Knightley noted employment has risen by 920,000 in the past two months using the household survey.
"So there is a real contradiction with the employment survey, which will only add to the confusion on how to interpret the report," Knightley said.
He added, "For now we are forecasting just one additional Fed rate rise this year, but consumer spending will be a key story to watch."
The report also said the annual rate of growth in average hourly employee earnings slowed to 2.7 percent in March from 2.8 percent in February.
by RTT Staff Writer
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