(March jobs report updated with additional information)
NEW YORK (
TheStreet) -- The economy added jobs at a faster pace than expected in March, evidence that the economic recovery is gaining momentum.
The Bureau of Labor Statistics said in its Employment Situation Report that nonfarm payrolls rose by a seasonally adjusted 216,000 in March. That was well ahead of expectations. Economists were expecting the headline number to increase by 185,000 according to consensus estimates from
Companies added 230,000 jobs, helping to offset the decline in state and local government payrolls. Economists forecast private payrolls to increase by 203,000, according to
Briefing.com. The ADP said in its estimate that companies added 201,000 jobs in March.
The report also included revisions to previous month's data. Nonfarm payrolls rose by 194,000, higher than 192,000 originally reported. Private payrolls increased by 240,000, more than the 222,000 originally estimated.
The average monthly gain in payrolls in 2011 is 159,000. That is just about enough to keep pace with the number of new entrants entering the labor force, but still not strong enough to bring a sharp drop in unemployment.
The unemployment rate unexpectedly ticked down to 8.8%. The unemployment rate has dropped by a full percentage point in the last four months. The steep drop has confused markets, as the pace of job creation has not been that rapid.
One reason for the drop has been because the household survey has shown a more rapid increase in employment than the establishment survey. According to the household survey, the number of employed increased by 291,000 in March.
The labor force has also seen a massive decline since 2010, though it is unclear how much of that drop is merely a result of a statistical change and how much is a result of more workers dropping out of the labor force.
The employment-to-population ratio, a more reliable estimate of the employment situation as it is not affected by whether someone is counted in the labor force, ticked up by a tenth of a point to 58.5%, though it still remains starkly below the prerecession level of slightly over 62%.
The total number of unemployed is at 13.5 million, with 6.1 million falling under the category of the long-term unemployed -- those who have been out of work for more than 27 weeks.
Check Out Our Best Services for Investors
Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts