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Job Growth Skyrockets

unemployment graphic
AP / CBS
U.S. payrolls grew by a surprising 308,000 in March, the largest gain since April 2000, the Labor Department estimated Friday.

The unemployment rate nudged a tenth of a percent higher to 5.7 percent, based on a separate survey of U.S. households. That occurred because more job seekers renewed their searches last month, but were unsuccessful.

The gain in payrolls far exceeded the 122,000 expected by economists surveyed by CBS MarketWatch. Economists had been waiting in vain for months for hiring to pick up to match the explosive growth in U.S. gross domestic product over the past nine months.

"I'm not saying the labor markets are back where they need to be, but this latest job advance together with the positive revisions are making this look like a normal recovery," said economist Ken Mayland, president of ClearView Economics.

At the White House, President Bush flashed a thumbs up when asked about the new jobs numbers, CBS News White House Correspondent Mark Knoller reports.

Economists said several technical factors would likely boost payrolls in March, including the end of the grocery strike and the return to more seasonable weather.

Payroll growth in previous months was also revised higher, by a total of 86,000 jobs. January's gain was revised from 97,000 to 159,000 while February's was revised to 46,000 from 21,000.

Over the past eight months, payrolls have grown by 759,000, about 95,000 a month. The economy needs to create about 130,000 to 150,000 jobs a month to absorb population growth.

For the first time in 44 months, employment in the manufacturing sector did not fall; it was unchanged. Construction added 71,000 jobs, likely a partial rebound from bad weather in February.

Payrolls in services rose by 230,000 jobs, including 47,000 in retail. Temporary help services jobs fell by 2,000.

Private payrolls rose by 277,000, as 31,000 government jobs were added, most in education.

Of 278 industries, 61 percent reported higher payrolls in March, the largest percentage since July 2000.

Despite the increase in jobs, hours worked in the economy fell by 0.1 percent. The average workweek also fell by a tenth of an hour to 33.7 hours. Hours worked in the manufacturing fell 0.3 percent, with a drop of 0.1 percentage points in the average workweek to 40.9.

Average hourly earnings rose 2 cents, or 0.1 percent, to $15.54 an hour.

While the payroll survey of 400,000 business establishments painted a rosy portrait of the U.S. labor market, the separate survey of 66,000 households was not as positive.

Total employment fell by 3,000 while unemployment rose by 182,000 to 8.35 million. The labor participation rate was unchanged at 65.9 percent.

The number of workers who've been jobless for longer than six months rose to 1.99 million, representing 23.9 percent of all unemployed workers. The figures do not count those who've stopped looking for work.

The average duration of unemployment fell to 20.1 weeks from 20.3 weeks. The median duration of unemployment was steady at 10.3 weeks.

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