Private sector adds 209,000 jobs in March

@CNNMoney April 4, 2012: 9:30 AM ET

NEW YORK (CNNMoney) -- Private companies continued to add jobs in March, albeit at a slightly slower pace than in February.

Businesses added 209,000 jobs in March, according to a report issued Wednesday by payroll-processing company ADP. Those job gains were slightly lower than forecasts for 217,000, and marked a slowdown from 230,000 private sector jobs added in February.

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Strong jobs data throughout the winter has been partially attributed to unseasonably warm weather, which allows some firms -- in construction, for example -- to remain fully operational during colder months. Once that effect fades, economists are bracing for weaker job creation.

But Wednesday's report showed no sign of a sharp slowdown.

"Today's number doesn't show such a weakening," said Joel Prakken, chairman of Macroeconomic Advisers. "It's pretty much in line with the last several months of increases."

The economy needs about 125,000 new jobs each month just to keep the unemployment rate steady. To fully dig out of the jobs hole left by the financial crisis, it needs far more.

Will we ever see 5% unemployment again?

Prakken forecasts that it could take another three or four years for the unemployment rate to fall back to a pre-recession level of around 5%.

"I'm pleased with today's number, but I'm left with this concern that we aren't stepping up to the next level," Prakken said. "We would need 300,000 or 400,000 in order to push the unemployment rate down as people jump back into the labor force."

Small businesses continued to drive job growth in March, according to ADP.

Companies with fewer than 50 employees made up about half of all private sector job gains, hiring 100,000 people.

Large companies with 500 or more employees hired 22,000 new workers, and medium-sized businesses added 87,000 to their payrolls.

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The ADP report typically sets the tone for the government's highly anticipated monthly jobs report, due Friday. While the reports tend to show the same trends over the long term, their figures can diverge from month to month.

Economists surveyed by CNNMoney expect the Labor Department's data to show 200,000 jobs added in March, including 210,000 from the private sector and a loss of 10,000 government jobs. To top of page

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