The U.S. jobs report for March delivered a mixed message Friday as hiring fell to its weakest pace in nearly a year. Yet at the same time, the unemployment rate reached the lowest level in nearly a decade.
Employers added just 98,000 jobs, the Labor Department said. That was barely half the previous month's gain and a potential sign of weakening growth. Yet economists largely downplayed the drop, attributing much of it to a snowstorm that hit the Midwest and Northeast just as the government was compiling its hiring data.
The steady job market has been a pillar of a resilient U.S. economy, and most analysts expect hiring to return to a pace closer to 178,000, the average monthly job gain for the past three months and close to the monthly average for 2016.
Most economists had predicted a drop-off in hiring in March after robust gains in both January and February, but the drop was worse than projected. Many said they regarded the tepid figure as likely just a blip.
"It's very premature to conclude that there's been an interruption of what has been fantastic momentum in the labor market," said Carl Tannenbaum, chief economist at Northern Trust.
The unemployment rate declined last month to 4.5 percent, the lowest rate since May 2007, from 4.7 percent in February. The rate fell because nearly a half-million more Americans reported finding jobs, the government said.
That result appeared to be at odds with the reported gain of a mere 98,000 jobs. The difference reflects a little-known aspect of the monthly jobs reports: The count of jobs and the number of people who reported being hired are compiled by two separate surveys. One surveys businesses, the other households.
The survey that counts people with jobs offered other encouraging news: The number of part-time workers who would prefer full-time work fell. So did those who had stopped looking for work in the past year.
As a result, an alternative gauge of unemployment, which includes both those groups, dropped to 8.9 percent, the lowest level in more than nine years.
"Within the disappointing 98,000 net new jobs added, there seems to be a lot more going on beneath the surface and what is going beneath the surface is mostly good," said Mark Vitner, an economist at Wells Fargo.
The government also revised down the job growth for January and February by a combined 38,000. And it reported that average hourly earnings rose 0.2 percent in March from February and have increased 2.7 percent over the past 12 months.
Construction companies added just 6,000 jobs in March, the fewest in seven months. Retailers, suffering from the shift to online shopping, slashed 30,000 jobs. Education and health care services added the fewest jobs for that category in 15 months.
The report showed that large numbers of teenagers, women and Latinos found jobs last month. The unemployment rate for teens dropped to 13.7 percent from 15 percent. That is the lowest teenage unemployment rate since 2001.
The economy appears to have slowed in the first three months of the year, though most economists expect a rebound in the current April-June quarter.
Consumer and business sentiment has soared since the November presidential election, but the increased optimism has yet to translate into faster growth or hiring. Consumers actually slowed their spending in January and February, when adjusted for inflation. Any such pullback tends to exert a drag because consumers account for about 70 percent of the economy.
Businesses have been ordering more high-cost manufactured good since fall, a reflection of stepped-up investment. But those orders slipped in February and remain below levels of a year ago.
Still, some areas of the economy are humming: Developers are building more homes, with construction starts up 7.5 percent in January and February compared with a year earlier. And home sales reached their highest level in a decade in January before slipping a bit in February.
What's more, for the first time in years, overseas growth stands to boost the U.S. economy. Germany's factories enjoyed a surge in orders in February. The rest of Europe, as well as Japan, is reporting faster growth, and China is stabilizing after fears about its outsize debts roiled markets last year.