Despite jobless claims taking a dive last week, the US labor market is not as strong as analysts expected. With 126,000 jobs added to the economy, the payroll gains in March were the smallest since December 2013.
The US economy broke its 12-month streak of job gains above 200,000 when it added only 126,000 in March, the Labor Department said Friday. It was the lowest monthly gain since December 2013.
The Labor Department also revised down its estimates of the number of jobs created in January and February this year by a combined total of 69,000 - a further sign that the pace of hiring in the US was slowing.
The figures came as a surprise to analysts, who expected an addition of 248,000 jobs in March after data earlier this week showed US jobless claims had dropped by 20,000 to a seasonally adjusted four-week average of 268,000.
Past job creation, along with cheaper oil prices, has yet to noticeably encourage consumer spending, as economic growth was strained this year by a strong dollar, factory slowdowns and tepid construction activity.
But the news in the report was not all doom and gloom.
Unemployment logged a 6-1/2-year low of 5.5 percent, despite people leaving the labor force.
Average hourly earnings, which are being closely watched for hints on the timing of an interest rate hike by the US Federal Reserve, also rose seven cents in the past 12 months, marking a year-over-year increase of 2.1 percent.
Due to mounting public pressure, large employers like McDonald's, Wal-Mart and Gap have announced pay raises for their lowest-paid employees. But analysts said these increases are unlikely to fuel faster wage growth, since these pay raises are staggered and not affecting everyone.
el/cjc (AP, Reuters, AFP, dpa)