WASHINGTON (AP) - The U.S. job market slowed in March as
companies hit the brakes on hiring amid uncertainty about the
economy's growth prospects. The unemployment rate dipped, but
mostly because more Americans stopped looking for work.

The Labor Department said Friday that the economy added 120,000
jobs in March, down from more than 200,000 in each of the previous
three months.

The unemployment rate fell to 8.2 percent, the lowest since
January 2009. But the rate dropped because fewer people searched
for jobs. The official unemployment tally only includes those
seeking work.

Despite the pullback in March, the economy has added 858,000
jobs since December - the best four months of hiring in two years.

A mild winter may have partially influenced the disappointing
job numbers in March. January and February were unusually warm,
which allowed construction firms and other companies to hire people
for outdoor work several weeks earlier than usual, effectively
stealing jobs from March.

But the job market might have bigger problems. Federal Reserve
Chairman Ben Bernanke and other economists have warned that the
economy is not growing fast enough to sustain strong job growth and
tumbling unemployment.

Slower economic growth has led some analysts to scale back their
forecasts for corporate profits in the January-March quarter.

Weak job growth could threaten a recent rise in consumer
confidence and dent investors' enthusiasm for stocks. It also could
prove a setback for President Barack Obama's re-election hopes.

But economists noted that it's just one weak month after three
solid gains. Many were encouraged by strong job growth at
factories, hotels and restaurants - industries that reflect the
health of the economy.

And government hiring was little changed in March, a positive
sign after months of job cuts at the state and local level.

"We are disappointed," said Anthony Chan, chief economist at
JPMorgan Wealth Management. "But when you go inside and lift the
hood, the numbers look a little better."

Obama emphasized that the economy is still improving, if
fitfully.

"It's clear to every American that there will still be ups and
downs along the way and that we've got a lot more work to do,"
Obama said during remarks at a White House forum on women and the economy.

Treasury yields and stock futures dropped sharply after the
report came out. The yield on the benchmark 10-year Treasury note
fell to 2.09 percent from 2.20 percent, while Standard & Poor's 500
index futures fell 1.1 percent to 1,374. Both were little changed
in the minutes before the report was released.

Most U.S. financial markets are closed for the Good Friday
holiday, and others are open for abbreviated sessions. The stock
market is closed, but index futures traded for 45 minutes after the
jobs report came out. U.S. government bond trading ends at noon
Eastern.

The biggest hit to the job market in March was at retail stores.
They shed nearly 34,000 jobs after cutting nearly 29,000 in
February. Temporary help firms dropped almost 8,000 - a potentially
bad sign for the job market because companies often hire temp
workers before adding full timers.

But manufacturers added 37,000 jobs. Hotels and restaurants
added 39,000. And business and professional services added 31,000
jobs.

There also was improvement in a broader measure of weakness in
the job market. The percentage of Americans who are either
unemployed, have given up looking for work or have had to settle
for part-time work fell from 14.9 percent in February to 14.5
percent last month.

More than 5.3 million Americans, or 42.5 percent of the
unemployed, had been out of work for six months or longer in March.

Hiring was slightly better in January and February than first
reported. The government revised up job growth in those months by
4,000.

Hourly wages rose 5 cents to an average $23.39. The average
workweek, though, fell slightly to 34.5 hours in March.

Obama's re-election hopes may depend on continued improvement in
the unemployment rate and job creation.

Former Massachusetts Gov. Mitt Romney, the likely Republican
challenger, this week blamed the president's policies for slow
growth and high unemployment.

The Obama campaign has said that Romney would reinstate policies
that led to the recession - lower taxes for the wealthy and less
regulation for business.

For many, what matters most is the unemployment rate. It was 7.8
percent when Obama entered office in January 2009 and peaked at 10
percent nine months later. Since August, it has dropped from 9.1
percent to March's 8.2 percent.

No incumbent since World War II has faced voters with
unemployment higher than 7.8 percent.

Other data suggest the economic recovery is gaining strength.
The number of Americans seeking unemployment benefits fell last
week to a four-year low, the government said Thursday. Consumers
are more confident and spending more.

The service sector expanded at a healthy clip in March and
increased hiring, according to a private survey released Wednesday
by the Institute for Supply Management. Factories are busier.
Companies are investing more, ordering more machinery and other
equipment.

Economists have worried all along that job growth couldn't
sustain the strong December-to-February pace.

They also worry that a 66-cent run-up in gasoline prices (to a
national average $3.94 a gallon) so far this year will discourage
consumer spending - though American households are more resilient
financially after cutting their debts.

Most economists expect annual growth this year of just 2.5
percent. Normally, it takes annual growth of 4 percent to lower the
unemployment rate 1 percentage point over a year.

The job market is improving largely because the pace of layoffs
has fallen sharply. The staffing firm Challenger, Gray & Christmas
reported Thursday that planned layoffs fell 27 percent from
February to March. Hiring, meanwhile, is still running nearly 20
percent below pre-recession levels.

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