(Bloomberg) — Employers in the U.S. boosted payrolls in March and the unemployment rate held at 6.7% even as more Americans entered the labor force, showing steady progress that may prompt Federal Reserve policy makers to continue reducing stimulus while keeping interest rates low.
Payrolls rose 192,000 after a 197,000 gain in February that was larger than first estimated, the Labor Department reported today in Washington. The median forecast in a Bloomberg survey of economists projected a 200,000 gain. Private employment, which excludes government jobs, surpassed the pre-recession peak for the first time.
Employment in January and February was revised higher, showing the effect on the labor market from inclement winter weather was less severe than previously thought. The gain puts payroll growth in step with the average over the past two years and shows companies are optimistic about the outlook for demand.
“This is a very good report,” said Nariman Behravesh, chief economist at IHS Inc. in Lexington, Massachusetts, and the top payrolls forecaster in the last two years, according to data compiled by Bloomberg. “It looks like we’re back on track.”
Revisions to prior reports added a total of 37,000 jobs to payrolls in the previous two months. The report also showed an increase in hours worked and little change in hourly earnings from February.
Forecasts for March payrolls ranged from increases of 150,000 to 275,000 after a previously reported 175,000 gain a month earlier, according to the Bloomberg survey of 90 economists. Last year, the U.S. added 194,000 jobs each month on average after 186,000 in 2012.
Private payrolls, which don’t include government agencies, increased 192,000 in March, the most in four months, after a 188,000 gain. With last month’s increase, total private payrolls reached 116.1 million, surpassing the pre-recession peak.
Accounting firm Ernst & Young LLP plans to increase hiring this year by almost 22%, said Dan Black, director of recruiting for the Americas. The New York-based company will recruit 12,700 employees. Of those, 7,200 will be recent college graduates.
“Not only are we back to pre-recession level, this is the largest number of hires we’ve ever made in the United States,” Black said. “When you see growth like that, for me, and for us, that’s an indicator of something positive. We’re seeing a lot of demand here.”
The U.S. has recovered all but 437,000 of the 8.7 million jobs, including those at government agencies, lost as a result of the last recession.
Factories reduced payrolls by 1,000 workers after adding 19,000 in February, today’s report showed. Construction companies boosted employment by 19,000 workers and retail payrolls rebounded 21,300.
