US employers cut a smaller than expected 36,000 jobs in February, leaving the unemployment rate unchanged at 9.7 per cent, according to a new government report which said it was unclear how severe weather had impacted payrolls.
The Labor Department said job losses for December and January had been revised to show 35,000 fewer jobs lost than previously reported.
Analysts polled by Reuters had expected non-farm payrolls to drop 50,000 last month and the unemployment rate to edge up to 9.8 percent. The median forecast from the 20 most accurate forecasters also saw payrolls falling by 50,000, while the 10 most accurate economists predicted a 70,000 decline.
Analysts had feared that the heavy snowstorms that hit large areas of the United States during the survey week for the employment report would cause a huge drop in payrolls.
However, the Labor Department said while the winter storms might have affected payrolls, it was difficult to quantify the net impact on employment.
"Nor do we know how new hiring or separations were affected by the weather. For those reasons, we cannot say how much February's payroll employment was affected by the severe weather," said Bureau of Labor Statistics Commissioner Keith Hall.
Unemployment is one of the toughest challenges facing president Barack Obama, whose approval ratings have dropped.
Obama and fellow Democrats worry voters could punish them in November congressional elections if no progress is made in putting Americans back to work as the economy emerges from its worst downturn since the 1930s.
Since the start of the recession, 8.36 million jobs have been lost.
The labour market is gradually improving and the pace of layoffs has slowed markedly from early last year when the economy was losing 750,000 jobs on average a month.
Manufacturing added 1,000 jobs in February, but construction payrolls fell 64,000 jobs. Temporary hiring added 48,000.
The average workweek for all employees slipped to 33.8 hours from 33.9 hours in January.
Reuters