(MENAFN- AFP) The US economy posted solid jobs growth in March and the unemployment rate ticked up but for a good reason: more people entering the labor market.
The Labor Department reported Friday the economy added 215,000 jobs in March, slightly easing from February's gain yet still suggesting the labor market, a bright spot in the economy, is holding up despite signs of weakening US economic growth and the global slowdown.
Jobs growth topped the average analyst estimate of 200,000 for March. The job gains in February and January were revised slightly lower, by a combined 1,000 jobs.
The jobless rate edged up a tenth point to 5.0 percent as a growing number of people entered the jobs market. The rate had held at 5.0 percent from October through December, before dipping for the first two months of the year to 4.9 percent, an eight-year low.
The participation rate in the labor force, which measures those having a job or seeking employment, rose for the fourth straight month to 63 percent, its strongest level since March 2014.
That represents nearly 400,000 people who entered the jobs market and in part explains the slight uptick in the unemployment rate.
"The US jobs market is still on a roll," said IHS chief economist Nariman Behravesh.
He noted two longer-term, "particularly encouraging" trends: Jobs gains in the past two years have been the strongest since 1998-1999 and March marked the sixth consecutive month of large gains in the labor force.
"This is a vote of confidence on the part of workers regarding the health of the US economy," Behravesh said.
The private sector added 195,000 jobs in March, the 73rd straight month of job growth, a record streak that has added 14.4 million jobs in the past six years since the economy exited the Great Recession in 2009.
Among the sectors posting job gains were retail trade, including restaurants and bars, healthcare and construction.
Government added 20,000 payrolls.
Over the first quarter, the average monthly gain was a still-healthy 209,000, compared with an average of 229,000 in 2015.
- Fed caution -
The improving labor market is a key reason for the Federal Reserve's historic interest rate increase in December, a quarter point lift in the federal funds rate pegged near zero for seven years to support the recovery.
Since then, the Fed has lowered its outlook for the future path of rate hikes, citing slowing global growth and markets turmoil.
Tepid US wage growth, one of Fed Chair Janet Yellen's concerns because it indicates continued slack in the jobs market, picked up slightly in March. Average hourly wages rose seven cents to $25.43, after a two-cent fall in February, and were up 2.3 percent from a year ago.
The work week was unchanged at 34.4 hours.
Yellen was more dovish about the prospects of raising interest rates this week, saying in a speech Tuesday that the US central bank should "proceed cautiously" given troubles in the global economy.
Markets saw her remarks taking a rate hike off the table at the Fed's April 26-27 policy meeting and probably at the June meeting.
Analysts said the March jobs report, though solid, was not seen as pushing the Fed toward a rate hike.
"Another good month of hiring in the US will encourage further chatter in some corners of the Fed moving closer to hiking interest rates again," said Chris Williamson of Markit.
"But signs of weakening economic growth mean policymakers are likely to be cautious and hold off until the global economy is showing greater vigor and the US economy more sparkle."
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