Jobless rate rises; 58,000 new jobs

WASHINGTON -- U.S. companies added jobs in March for the first time in eight months, fresh evidence the economy is on the road to recovery even though the unemployment rate edged up to 5.7 percent.

The Labor Department reported Friday that payrolls grew by 58,000 during the month, a welcome sign after companies had slashed hundreds of thousands of positions as they tried to cope with the recession and the jolt of the Sept. 11 terror attacks.

"The economy and the job market have turned the corner from recession to recovery," said Mark Zandi, chief economist at Economy.com.

After having lost nearly a fifth of their work force since September 2000, temporary help firms added 69,000 jobs in March, the second straight month employment grew.

Economists viewed that as a particularly encouraging sign for job growth in general in the months ahead. Companies often hire temporary workers before they hire new full-time workers or rehire laid-off workers, they said.

Employment in the services sector went up by 118,000 last month, the largest gain in a year and a half.

Though factories, hardest hit by the slump, continued to shed jobs in March, losses during the month totaled just 38,000, the smallest cut since December 2000.

Manufacturing on mend

The average weekly hours worked in manufacturing grew in March to 41.1 hours from 40.7 hours -- "a clear sign that manufacturing is on the mend and orders are picking up," said National Association of Manufacturers President Jerry Jasinowski. Economists said the pickup in weekly hours bodes well for some job growth at factories in the coming months.

On Wall Street, blue-chip stocks moved higher. The Dow Jones industrial average closed up 36.47 points at 10,271.64.

Even though economists are optimistic that the nation's payrolls will continue to grow, many still foresee a rise in the nation's unemployment rate. That's because they don't think job growth will be strong enough to take care of an expected increase of people entering the labor force.

Economists predict the jobless rate will peak at 6 percent by June, reflecting their belief companies will be reluctant to quickly hire back laid-off workers until profits recover and executives are convinced the recovery is here to stay.