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Boost in jobs in March is most in three years

President Barack Obama tours the Celgard LLC facility in Charlotte, N.C., which received a $49 million grant from the U.S. Energy Department in August. It created nearly 300 direct jobs at the company, which makes high-tech battery parts.

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President Barack Obama tours the Celgard LLC facility in Charlotte, N.C., which received a $49 million grant from the U.S. Energy Department in August. It created nearly 300 direct jobs at the company, which makes high-tech battery parts.

WASHINGTON — The nation added jobs at the fastest pace in three years last month as factories, stores, hospitals and the census all brought workers on board — the surest sign yet that the worst employment market in a generation has finally snapped back.

The unemployment rate stayed at 9.7 percent for the third month in a row (12.2 percent for Florida in February), the Labor Department said Friday. Economists actually consider that a hopeful sign because it means more people are encouraged and starting to look for work.

"This recovery is for real," said Chris Rupkey, economist at the Bank of Tokyo-Mitsubishi.

Overall, the economy added 162,000 jobs for the month. About a third of the gains came from the census, with much more to come: About 700,000 head-counters will be hired to tally the nation's population this spring.

Economists took heart that even aside from the population count, the private sector added 123,000 jobs for the month, the most since May 2007.

Hiring is not expected to be robust enough soon to significantly bring down the unemployment rate. Economists think unemployment will probably still be above 9 percent by the November midterm elections, making Democratic and Republican incumbents in Congress vulnerable, particularly in hard-hit states such as Michigan, Nevada and Rhode Island.

President Barack Obama seized on the positive numbers in the jobs report and took partial credit.

"I've often had to report bad news during the course of this year, as the recession wreaked havoc on people's lives," he said. "But today is an encouraging day. We learned that the economy actually produced a substantial number of jobs instead of losing a substantial number of jobs."

But with 15 million people still out of work, he also acknowledged the economy will be recuperating for a long time to come.

"We are beginning to turn the corner. We shouldn't underestimate the difficulties we face," he told workers at the Celgard LLC factory, a company in Charlotte, N.C., that makes high-tech battery components, including membranes used in advanced lithium batteries, which received a $49 million grant from the U.S. Energy Department in August.

The president said the grant was creating nearly 300 direct jobs for the company and more than 1,000 jobs for its contractors and suppliers. He also pledged that a new emphasis on oil and gas drilling will not undercut alternative energy work.

House Republican leader John Boehner of Ohio said a jobless rate near 10 percent is "no cause for celebration." The unemployment rate peaked at 10.1 percent in October, a 26-year high.

No one disputes the job market is still bleak. Counting people who have given up looking for work and part-timers who would prefer to be working full time, the so-called underemployment rate rose to 16.9 percent in March.

But Friday's report from the Labor Department at least provides firm evidence that the job market is on the right track, even if it will be a long journey for the millions of Americans who want work but cannot yet find any.

"The economy is moving in the right direction, albeit at a torturously slow pace," said Paul Ashworth of Capital Economics.

Economists do not expect the jobless rate to drop to something more normal — 5.5 to 6 percent — until the middle of this decade.

In the meantime, economists are concerned that hiring now appears to be concentrated among large companies — a sign small businesses, which typically lead job creation in the early stages of a recovery, are having difficulty getting financing.

In March, the education industry led job creation, followed by health services and government. Those sectors, plus others like the hospitality industry, manufacturing and retail, will continue hiring as the recovery picks up, economists say.

Although construction companies added jobs last month, it was seen as a temporary snapback from February, when snowstorms along the East Coast idled many construction jobs. The real estate market is still fragile in much of the country.

Other pockets of weakness include financial services, publishing and state and local governments, which are grappling with budget crises from coast to coast.

Nationwide, average hourly earnings fell by 2 cents in March to $22.47. Stagnant wages are a big reason people are still hesitant to spend money, a drag on the overall economy.

The number of people forced to take part-time work in March rose by 263,000, to 9.1 million. The number of people out of work six months or longer reached 6.5 million in March, a new high.

The worst recession since the 1930s has wiped out 8.2 million jobs, making the competition for openings fierce. On average, there are five or six unemployed people competing for each opening, according to government data.

The economy must create 100,000 jobs each month just to absorb new entrants into the labor force, let alone provide a livelihood for the nation's 15 million people already looking for work.

That sustained level of growth may not come until later this year, economists said, making pervasive unemployment a virtual certainty for some time to come.

Indeed, the government predicts the jobless rate will average 9.8 percent next year and 8.4 percent in 2012 before falling to 5 percent in 2016. The rate was 4.7 percent in November 2007, the month before the recession began.

Information from the New York Times was used in this report.

Interest rates rise with increase in Employment

The biggest increase in jobs in three years pushed interest rates to their highest level since before the worst days of the credit crisis in 2008. With the stock market closed for Good Friday, investors had a shortened day of trading in the bond market to react to the Labor Department's report. Treasury prices fell after the report, sending their yields higher. Bond prices tend to fall as investors' confidence grows and demand for safe-haven investments wanes. The yield on the 10-year Treasury note rose to 3.94 percent from 3.87 percent late Thursday, its highest level since June. The yield on the 10-year note is tied to many kinds of consumer loans. The increase could raise borrowing costs for mortgages and other debt. The rate on a 30-year fixed mortgage Friday was 5.125 percent, up from 4.875 late Thursday.

Associated Press

Boost in jobs in March is most in three years 04/02/10 [Last modified: Friday, April 2, 2010 10:30pm]
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