Payrolls Grow by Less-Than-Expected 21,000 in February

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he Labor Department said Friday payrolls in February grew by 21,000, but unemployment rate held steady at 5.6% as more job-seekers left the work force.

The results followed a January gain of 97,000 that was less than previously estimated, Labor said. Analysts were expecting February payrolls to increase by 130,000, Bloomberg reported.

The department also revised lower its count of jobs gains in December to 97,000 from 112,000, and for November to 8,000 from 16,000.

Factory employment fell by 3,000 in February, the 43rd straight month it has declined. About 1.7 million factory jobs have been lost since the recession ended in November 2001.

The labor participation rate, which measures the number of people employed or looking for jobs, fell to 65.9% from 66.1%, as 588,000 people left the work force. February's participation rate was the lowest since September 1988.

Nigel Gault, U.S. research director at Global Insight Inc., told Bloomberg a struggling job market could lead to a drop in consumer spending, which could hurt the economic recovery.

The report also found that employment in service-producing industries, which include retailers and government agencies, gained 46,000 jobs after an increase of 77,000 in January.

Construction jobs fell by 24,000.