The US economy added 215,000 jobs in March, a little less than it did in February when 242,000 jobs were created. The unemployment rate has risen to 5% from 4.9%, which was an eight-year low.
The Labor Department said more Americans were finding jobs, which suggested a sign of confidence in the US economy.
The increase could allow a cautious Federal Reserve to raise interest rates gradually this year.
The US is continuing to create jobs, despite a global economic slowdown and cheap oil prices which have hit the energy sector.
The gains were in the service sectors, especially retail, health and education and leisure and hospitality. There were also new jobs in government and construction.
The unemployment figures for January and February have been revised slightly down to show 1,000 fewer jobs created than previously reported.
Weak growth
Chris Williamson, chief economist at Markit, said that while the numbers for jobs created last month looked good, a rate rise from the Federal Reserve would not be the right move.
“Another good month of hiring in the US will encourage further chatter in some corners of the Fed moving closer to hiking interest rates again, but signs of weakening economic growth mean policymakers are likely to be cautious and hold off until the global economy is showing greater vigour and the US economy more sparkle,” he said.
“However, while the labour market data shout ‘rate hike’, signs of a worrying weakness in the pace of economic growth at home and abroad caution against the Fed rushing into any further tightening of policy.”
Curtis Long, chief economist at the National Association of Federal Credit Unions in Washington, said that while the employment numbers were “solid”, not all areas of the economy were performing well.
“We are seeing some weakness in some industries like the oil sector. Manufacturing is having another bad month,” he said.
“Everything is not clicking on all cylinders. Growth is strong enough to support the labour market. We are drawing nearer to full employment. We could see some slowing in the second half.”
Financial markets have almost priced out the likelihood of a rate rise at the Fed’s June policy meeting. A survey from CME FedWatch suggests a 47% chance of an increase in November, with 57% suggesting it would happen in December.