--US March payroll jobs -86,000; jobless rate +0.1 pt to 4.3%
--US March job decline largest since November 1991
--US March avg hourly earnings +0.4%; February revised to +0.6%
--US March avg hourly earnings +4.3% from yr ago; Feb revised to +4.2%
--US March available labor pool down to 10.3 mln; Feb 10.4 mln
--US March workweek +0.1 hr; manufacturing workweek unchanged
--US March weekly hours index +0.1% to 151.4; factory index -0.5%
--US Feb payroll jobs revised to +140,000 from +135,000
--US Jan payroll jobs revised to +289,000 from +224,000
--US March factory jobs -81,000
--US March construction jobs +12,000; govt -4,000
--US March retail jobs -46,000; service producing -19,000
--US March jobless rate highest since July 1999

By Simon Kennedy
Washington, April 6 (BridgeNews) - The U.S. jobs market weakened further in March with non-farm payrolls plunging 86,000, their steepest drop since November 1991. Manufacturers and retailers shed staff to force the unemployment rate up to 4.3%, the highest since July 1999, the Labor Department reported Friday. Average hourly earnings rose 0.4%, slowing from the revised 0.6% increase in February.
* * * Analysts had projected a 50,000 increase in jobs, a 0.3% rise in average earnings and an unemployment rate of 4.3%. In February, payrolls climbed a revised 140,000, while the unemployment rate was at 4.2%. The slumping manufacturing sector cut payrolls for the eighth straight month, trimming them 81,000 in March, with declines through all manufacturing industries, Katharine Abraham, head of the Bureau of Labor Statistics, said.
Meanwhile, retailers reduced payrolls by 46,000, the first decline since September. Government jobs were cut by 4,000, while wholesale traders trimmed 2,000 positions to extend their cutting period to four months.
However, the construction industry created 12,000 new jobs, and services hired 11,000 more. Service employment was largely depressed by a sharp decline in help supply services, an industry composed mainly of temporary help firms, Abraham said.
The much weaker March jobs data reflects a faltering economy and follows announcements of huge corporate layoffs from the likes of Cisco. "Our March survey results provide further indication of weakness in the labor market," Abraham said.
Previously, firms had tried to cope with the stumbling economy by leaving payrolls alone and cutting on worker hours instead.
In March, the average workweek rose 0.1 hour to 34.3 hours, but the manufacturing workweek was unchanged at 40.7 hours, and factory overtime was cut by 0.1 hour to 3.8 hours.
The tightness of the labor market in recent years--with the jobless rate hitting a 30-year low of 3.9% last year--has been critical to the success of the economy. Its failure to slacken markedly despite the fact the economy grew just 1.0% in the final quarter and is anticipated to have expanded just 0.6% in the January-March period, has helped underpin consumer confidence as crumbling stock prices and bleak economic news elsewhere has unsettled sentiment. However, if the labor market continues to ease, households could begin to curb spending, knocking the economy and forcing the Federal Reserve to cut interest rates further.
The central bank has already lopped borrowing costs by 150 basis points since Jan. 3 and is expected to do so again in coming months as it strives to avert the first recession in just over a decade.
Despite some evidence that the labor market is loosening, the labor utilization pool, representing the sum of those employed and those who say they want a job but are not actively seeking work, fell to a seasonally adjusted 10.3 million from 10.4 million in February.

WHAT WAS EXPECTED:
March non-farm payroll growth was much weaker than private estimates in the BridgeNews survey, which ranged from down 30,000 to up 130,000. Expectations for the unemployment rate were 4.2 to 4.4%, while estimates for average hourly earnings ranged from up 0.1% to up 0.4%.