US hiring increased much more than expected last month, according to government data published Friday, putting pressure on the Federal Reserve as it considers when to start cutting interest rates.
The world’s largest economy added 303,000 jobs in March, surpassing a revised 270,000 jobs created a month earlier, the Department of Labor said.
This was far above market expectations of an increase of 200,000, Briefing.com said.
The unemployment rate sank lower to 3.8 percent from 3.9 percent in February.
Policymakers at the Fed have been debating when the rate time to lower interest rates will come, as they seek to return inflation to their long-term target of two percent, without harming the US economy.
Inflation dropped sharply last year while the economy and job market have remained strong. But it has climbed higher since the beginning of the year, leading some policymakers to delay their expectations for the start of cuts.
Wage growth increased 0.3 percent on a monthly basis, while average hourly earnings were up 4.1 percent compared to a year earlier, according to Labor Department statistics.
The strong jobs data has posed a challenge for President Joe Biden, who seeks to underscore the strength of the US economy ahead of the upcoming presidential election in November.
If inflation stays above target, stronger jobs and growth data will likely cause the Fed to remain on pause longer, causing a rise in cost to borrowing for consumers and producers.
This will make it more difficult for consumers who want to buy a home or repay credit card debt, and it makes it more expensive for companies to invest.
Fed policymakers in their March interest rate meeting penciled three cuts this year, although some have suggested they would prefer to see less cuts because of an uptick in inflation.
