U.S. economy adds 162,000 jobs in March

Reporting from Washington —  The American economy added 162,000 jobs in March, the biggest burst of hiring in three years, the Labor Department said Friday.

The unemployment rate held steady at 9.7%, the level it has been at for the last three months.

The March job gains, which were boosted by temporary hiring for the census, marked the biggest one-month increase since 239,000 jobs were generated in March 2007. The latest gain was slightly lower than what many economists had been forecasting, but the government also revised upward the payroll count for the first two months of the year. It said the economy created 14,000 jobs in January, instead of losing 26,000 as previously reported. And the losses in February were shaved by more than half, to 14,000.

The news of the hiring spurt last month will be welcomed by the 15 million jobless American workers -- it was only the third time the economy added jobs in the last 27 months. But the latest report somewhat overstated the strength of a slowly recovering labor market. About 30% of the payroll increases last month, or 48,000 jobs, were positions created by the Census Bureau, which is expecting to hire hundreds of thousands more workers in the next couple of months to knock on doors and collect data for the decennial count of the nation’s population. Many of these jobs are part-time and will last only several weeks.

The March payroll gains also were likely inflated a little by the restoration of work that was temporarily halted in February because of the severe snowstorms. Construction employment in March, for example, turned up for the first time in many months, adding 15,000 jobs over the month.

Stripping out these special factors, the report still showed some encouraging signs. Manufacturing payrolls expanded for the third month in a row, increasing by 17,000 in March. Healthcare employers added 27,000 jobs, and the private temporary-help sector boosted its employee count by 40,000.

Businesses in financial services cut 21,000 jobs over the month, and the information industry eliminated a net 12,000 positions.

Despite the overall payroll gains, they weren’t enough to bring down the jobless rate as more people are beginning to enter the labor force after the long recession that wiped out 8.4 million jobs.

And the labor market remains severely distressed, with 13 states in double-digit unemployment and a record 44%, of the unemployed, or 6.5 million people, who have been without work for six months or longer. A broader measure of unemployment and under-employment, which includes part-time workers who want full-time jobs, rose a notch to 16.9% in March.

don.lee@latimes.com