The U.S. unemployment rate nudged up two-tenths of a percentage point to 5.7 percent in March, but employers added 58,000 new positions to payrolls, signaling an economy that still needs some more time to recover completely.
The Labor Department said the number of workers on U.S. payrolls grew by 58,000 in March, a slightly larger rise than the 41,000 projected by economists in a Reuters survey.
But the number appeared much less impressive in light of a huge downward revision to February payrolls. Labor said February payrolls fell by 2,000 — a far worse showing than the 66,000 gain the department estimated a month ago. Labor did not offer an explanation for the substantial change to February's payrolls number but a breakdown of the figures showed that many of the revisions occurred in services jobs.
The unemployment rate climbed in March to 5.7 percent, the highest since December, from 5.5 percent in February. Private economists had expected a rise in the jobless rate to only 5.6 percent.
"It is a little weaker than I was expecting...It certainly suggests we are going to have a relatively slow expansion at this moment," said Delos Smith, analyst at the Conference Board in New York.
As it did during the last recession that ended in 1991, the nation's unemployment rate still could rise in coming months as businesses regain financial strength. Some economists think the rate will climb to more than 6 percent before a prolonged drop-off occurs.
To revive the economy, the Federal Reserve slashed interest rates 11 times last year, pushing some interest rates down to the lowest levels seen in four decades, making borrowing attractive for many businesses and consumers.
Some economists say the Fed may begin to raise short-term interest rate as early as May or June. But others aren't so sure. They wonder whether consumers who snapped up big-ticket goods throughout the slump will continue to spend briskly, a factor affecting the strength of the recovery.
Less than half of the payrolls growth logged in March occurred in the private sector. Government jobs jumped 37,000 while payrolls at private firms rose by only 21,000.
While the latest jobs report did not show a fiery pace of growth, it does help solidify an already widespread belief that the economy is emerging from a slump that began last March.
The downward revision of the February number meant that the March payrolls gain was the first in eight months and the two-month trend pointed to stabilization in the labor market, according to a Labor Department official.
The last time payrolls increased was in July of 2001, when they were up 18,000.
"The data for March and for February provide a marked contrast to the average monthly job losses of 144,000 that prevailed from March 2001 through January 2002," Lois Orr, acting commissioner for the Bureau of Labor Statistics, said in a statement.
One disappointing feature of the report was that manufacturing payrolls failed to snap their long trend of decline. Factory jobs fell 38,000 in March.
Reuters and the Associated Press contributed to this report.