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Joblessness at 4.7 percent thanks to upbeat employers
WASHINGTON -- Employers feeling upbeat about the economy boosted hiring by 211,000 in a springtime burst that pushed the unemployment rate down to 4.7 percent, matching its lowest point in 4 1/2 years.
The employment picture for March, released by the Labor Department on Friday, suggested that a strengthening economic expansion is putting companies in the hiring mood and brightening prospects for job seekers.
The Labor Department findings come the same day as the Senate's immigration overhaul hit a roadblock. The Senate has been working to agree on a complex new set of regulations for the estimated 11 million immigrants in the country illegally.
Hiring gains were fairly widespread. Construction, retailers, financial activities, education and health care, and government were among the sectors posting payroll gains. That helped to blunt job losses in manufacturing and in the transportation industries.
"I think the job market is on a roll," said Bill Cheney, chief economist at John Hancock Financial Services. "Businesses are doing pretty well these days. Profits are growing nicely. I think businesses are at a point where they feel more comfortable adding people."
But on Wall Street, stocks sank as investors fretted that businesses' growing appetite for workers might drive up wages -- and inflation -- down the road. The Dow Jones industrials lost 96.46 points to close at 11,120.04.
President Bush, coping with low job-approval ratings in a congressional election year, said the job figures provided "evidence of an economic resurgence that is strong, broad and benefiting all Americans." The president said his tax cuts were central to this and called on Congress to make them permanent.
Democrats, however, countered that the tax cuts mainly helped the wealthy and helped plunge the nation's balance sheets into red ink. Rep. George Miller of California called Bush "completely out of touch with reality."
Sen. John Kerry, D-Mass., observed: "Mothers and fathers are working harder and longer and struggling to keep up with the soaring costs of health insurance, gas and college tuition."
Some recent good news on the economy hasn't been helping Bush in the eyes of the public. Bush's job-approval rating of 36 percent is at its lowest level in an AP-Ipsos poll. When it comes to his handling of the economy, 59 percent said they disapproved.
The unemployment rate, which dropped from February's 4.8 percent, ended up matching January's jobless rate.
For blacks, though, the unemployment rate didn't budge; it held steady at 9.3 percent in March. The unemployment rate for Hispanics dipped to 5.4 percent last month and the jobless rate for whites edged down to 4 percent.
Overall employment was stronger in March than economists were expecting. They had forecast a gain of 190,000 jobs and believed the civilian jobless rate would hold steady.
The economy added 154,000 jobs in January and another 225,000 in February, according to revised figures released Friday. While job gains for each of those months turned out to be slightly less than previously reported, payroll growth for the January-to-March quarter as a whole was brisk. Job growth over the first three months of this year averaged 197,000.
Employees' average hourly earnings, meanwhile, were $16.49 in March, a modest 0.2 percent increase from February -- less than economists were expecting.
With the economy growing nicely and the job market blooming, the Federal Reserve and other economists are keeping a close eye on wage growth.
Wage improvement is good for workers, but a rapid, sustained acceleration would trigger inflation concerns.
Fed Chairman Ben Bernanke and his colleagues boosted interest rates on March 28 to a five-year high and hinted that additional increases were possible to keep inflation at bay. Economists predict rates will go up again on May 10.
Wages trailed inflation for most workers last year. For the 12 months ending March, wages were up 3.4 percent. That suggests "workers' paychecks are now keeping even with inflation," said Lynn Reaser, chief economist at Bank of America's Investment Strategies Group.
Economists said the improving job market should help support consumer spending -- an important ingredient to the economy's good health. That's against the negative force of a slowing housing market, which could make some people feel less wealthy and thus less inclined to spend.
The report also showed the average time that the 7 million unemployed spent searching for work in March was 16.9 weeks, down from 17.6 weeks in February.
The employment figures for March come against the backdrop of a rebounding economy. Analysts believe the economy emerged from an end-of-year funk and grew at an annual rate of 4.5 percent or higher in the just ended January-to-March quarter. The economy is expected to moderate in the current April-to-June quarter but still turn in a solid performance.