Total nonfarm payroll employment grew by 103,000 in March, a decrease from last month's strong reading of 326,000, according to the Bureau of Labor Statistics.
There is hope that wage growth will accelerate in the second half of the year and allow the US central bank to continue raising interest rates.
After Friday's numbers average jobs gains over the last three months now stand at 202,000.
With labor market slack diminishing, wage growth picked up a bit in March. "If anything, the wage data are beginning to strengthen the argument for three more hikes this year". Economists expected average hourly earnings to rise 0.3% over the prior month and 2.7% over the prior year.
The job figures come as concern grows about a trade war between U.S. and China.
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Average hourly earnings rose 0.3 percent for the month, pushing the 12-month change up to 2.7 percent from 2.6 percent, while the length of the average workweek held at 34.5 hours, just 0.1 hours below the peak of 34.6 hours last hit in January 2016.
"The declaration by Trump that he has instructed the US Trade Representative to consider another $100 billion of tariffs under section 301 has once again sent markets lower, although not as much as previous tariff announcements have", noted Craig Erlam at online trading platform operator Oanda. The dollar weakened against a basket of currencies and US Treasury prices rose.
Economists say it's unlikely the trade concerns contributed to the slowdown in job growth. Growth in the January-March period tends to be weak for seasonal reasons. But the firm expects growth to rebound to a decent 3.1 percent annual pace in the current April-June quarter. Growth this year is seen bolstered by a $1.5 trillion income tax cut package and increased government spending, which economists say will offset some of the impact from the stock market's gyrations.
"The principle story as we see it is that despite above trend jobs growth in the main, the unemployment rate has been flat for six months".
For example, a rising number of working-age Americans have begun looking for a job and finding one, reversing a trend from the first few years after the recession when numerous unemployed grew discouraged and stopped looking for work. But retail businesses shed 4,000 jobs and construction companies lost 15,000 workers after going on a hiring spree in February.
The return of cold weather and a shortage of skilled workers weighed on hiring at construction sites in March. Excluding the addition of 1,000 workers from government payrolls, the private sector added just 102,000 for March.