US job growth declined dramatically during March as the country’s economy added only 126,000 new employments as compared to 264,000 done in the month of February.
The Labor Department report showed that this was the smallest gain since December last year.
According to the experts, the report of just 126,000 new jobs is expected to further delay the potential increase in the interest rates by the US Federal Reserve Bank.
A slowdown in the manufacturing sector impacted by the lower crude oil prices, strong US dollar, and harsh winter weather conditions has likely dragged on businesses when it came to recruiting as leisure and hospitality sectors recorded a steep slowdown in jobs growth.
The rate of unemployment held steady at 5.5 percent, a low of more than six years. The overall size of the workforce contracted. The rate of participation of the labor force came back to a low of 36-year reached late last year.
The greenback has surged in value close to 13 percent against a basket of currencies since mid June of last year. Several economists said the impact was equivalent to an interest rate hike of one-half point.
The sharp decline in crude oil prices has also restricted the drilling activity in the US. The employment in construction sector has been limited as payrolls in mining dropped by more than 11,000, which signaled an ongoing gas and oil extraction slowdown. The energy producers have shuttered several oilrigs since the beginning of October of 2014.
The unfavorable weather conditions during late winter of 2014 as well as the recently settled West Coast port dispute weighed heavily on economic activity along with a weaker demand in the global market. It was estimated that harsh weather cut off up to seven-tenths of one percent from economic growth in the first quarter.
On the positive front, the average earnings per hour rose by 0.35.