U.S. employers add 98,000 jobs; jobless rate falls to 4.5 per cent

WASHINGTON — American job growth slowed sharply last month, surprisingly tumbling to its lowest level in nearly a year — although bad weather probably depressed the numbers.

The U.S. economy added just 98,000 net new jobs, a little more than half of what analysts had expected, the Labor Department said Friday. The figure was well off the 219,000 positions created in February. In addition, the totals from January and February were revised down by a combined 38,000 jobs.

The first three months of 2017, the economy added an average of 178,000 net new jobs a month. That is down from the 187,000 monthly average last year.

Despite the lacklustre jobs growth, the unemployment rate dropped to 4.5 per cent as almost 500,000 more people found work. The unemployment rate was the lowest since 2007, before the Great Recession hit.

Wages continued to show solid growth in March, with average hourly earnings increasing 5 cents to $26.14, following a 7-cent rise the previous month. Wages increased 2.7 per cent for the 12 months ended March 31.

March job growth likely took a hit from a bad Northeastern snowstorm that struck during the week that the Labor Department surveys households about their work status.

Analysts had said the strong job creation the previous two months had been boosted by unusually warm weather.

The construction industry showed the effects weather can have. The sector added just 6,000 net new jobs in March, the worst in seven months, after payrolls surged by 59,000 in February.

The retail sector continued to struggle last month. Retailers slashed their payrolls by nearly 30,000, after cutting about 31,000 jobs in February.

Hiring was off sharply for education and health-services providers. They added just 16,000 net new jobs in March, the fewest in 15 months, after payrolls increased by 66,000 in February.

Federal Reserve officials have cited solid job growth in recent months as a key reason they increased the benchmark short-term interest rate in March, for the second time in three months.

Anticipation of continued labour market improvement has led central bank policy-makers to signal two more hikes are coming this year.