The US economy added 143,000 jobs last month, the most in 26 months, and the unemployment rate dropped to 5.7 percent as companies gained confidence that growth may accelerate.
Gains in retail and construction employment made up the bulk of the new jobs, aided by seasonal adjustments, the Labor Department said.
The unemployment rate fell from an eight-year high of 6 percent in December. The increase in payrolls follows a loss of 156,000 thousand in the previous two months.
"The momentum in hiring is starting to turn up again," said James O'Sullivan, an economist at UBS Warburg LLC in Stamford, Connecticut, before the report.
To produce more, "employers are going to have to start hiring more people. Within a few months we will be seeing more job growth," he said.
The economy is expected to expand 2.8 percent this year, faster than in 2002, and that may be prompting companies to add jobs.
Economists had expected payrolls to rise by 68,000 last month following a previously reported decrease of 101,000 in December, according to the median of 65 forecasts in a Bloomberg News survey.
The unemployment rate was expected to hold at 6 percent for a third straight month.
The Labor Department issued its annual benchmark revisions to employment figures with yesterday's report.
The changes took into account adjustments to seasonal variation factors that affected the numbers back to 1998.
Last month's job gains were led by a 101,000 increase in retail employment that suggests the government had difficulty in adjusting the data for seasonal variations.
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