WASHINGTON - US employers hired far fewer workers in March than in previous months, keeping the door open for the Federal Reserve to provide more monetary support for a still sluggish economy.
The report was seized upon by Republicans hoping to make the weak economy the centrepiece of their campaign for November's presidential and congressional elections.
Even as the unemployment rate fell to a three-year low of 8.2 per cent, job growth slowed to 120,000 last month, the labour department said on Friday, the smallest increase since October.
That was less than half the average monthly increase in the prior three months and way below the lowest estimate in a Reuters survey. Economists had expected an increase of 203,000 and the jobless rate to hold at 8.3 per cent.
The numbers likely reflected the fading boost from unseasonably warm winter weather and brought the job market, which had been showing surprising strength since December, more in line with signs of a broader slowdown in the overall economy.
It also backed the caution expressed by Federal Reserve chairman Ben Bernanke last week about whether the labour market could sustain gains above the 200,000 mark when economic growth is tracking a sub-par rate. Retail employment surprisingly fell for the second straight month, resulting in the vast private services sector adding jobs at the slowest pace in seven months.
Economists were puzzled by the drop given that retailers such as Macy's and Target reported brisk business in March.
Manufacturing jobs picked up, even though the workweek fell slightly. Factory jobs have increased by 120,000 so far this year, helped by carmakers trying to meet pent-up demand for motor vehicles.