Employers also gave their workers fatter paychecks. But the strong numbers could pressure the Fed to raise interest rates sooner. Fred Katayama reports.
Employers added lots of jobs last month and gave their workers fatter paychecks despite signs of a slowdown in growth. Payrolls rose by 257,000. That's much more than expected. That was the 11th month in a row of job gains over the 200,000 mark. And the payroll increases for the previous two months were upwardly revised by a whopping 147,000. The unemployment rate inched up to 5.7 percent, but for a good reason: more people went looking for work, a sign of confidence in the jobs market. Adding to the optimism: Average hourly earnings rebounded, rising half a percent. Job gains were nearly across the board led by the retail, construction and healthcare sectors. Payrolls fell in government and transportation. The strong numbers could pressure Fed officials to move faster on interest rates. Wells Capital Management chief investment officer Jim Paulsen said, "A report like this would be positive for equities elsewhere, but in the United States, it is becoming a mixed bag. It moves the window for the Fed (to raise rates) back to the summer and maybe even sooner." The positive report sent stocks up in early trading. Bond yields ticked higher. And the dollar rose against the yen.