Employers in the U.S. added fewer jobs than forecast in March, underscoring Federal Reserve Chairman Ben S. Bernankeâ€™s concern that recent gains may not be sustained without a pickup in growth.
The 120,000 increase in payrolls, the fewest in five months, followed a revised 240,000 gain in February that was bigger than first estimated, Labor Department figures showed today in Washington. The March increase was less than the most pessimistic forecast in a Bloomberg News survey in which the median estimate called for a 205,000 rise. Unemployment fell to 8.2 percent, the lowest since January 2009, from 8.3 percent.
Faster employment growth that leads to bigger wage gains is necessary to propel consumer spending that accounts for about 70 percent of the economy. Todayâ€™s data showed Americans worked fewer hours and earned less on average per week, helping explain why policy makers say interest rates may need to stay low at least through late 2014.
â€œYouâ€™re going to see a slowing in the pace of job growth,â€ Neil Dutta, an economist at Bank of America Corp. in New York, said before the report. â€œDespite the much ballyhooed recovery in the labor market, weâ€™ve seen more jobs and yet disposable income is weaker.â€
Stock-index futures declined after the figures, with the contract on the Standard & Poorâ€™s 500 Index expiring in June falling 0.8 percent to 1,379 at 8:33 a.m. in New York. The yield on the benchmark 10-year Treasury note fell to 2.10 percent from 2.18 percent.