WASHINGTON (MarketWatch) — The U.S. created 257,000 jobs in January and companies are hiring at the fastest pace since 1997, with evidence emerging that a rapidly improving labor market might finally be triggering higher wage growth.

The unemployment rate, meanwhile, edged up to 5.7% from 5.6%, but that’s because people looked for jobs. A healthier labor market typically draws more people into the labor force.

Hiring has boomed since last fall. The U.S. has added an average of 336,000 jobs in the past three months, the fastest clip since 1997 when the Internet economy was taking root. And job creation in November was revised up to show a whopping 423,000 gain, including the biggest spurt of private-sector hiring in 18 years, government figures show.

‘Boom’ — wages rebound and past months see massive revisions

Most industries added employees, another sign the U.S. has shifted into a higher gear even as major economies around the world struggle.

“What this tells us is that the recovery has broadened and prosperity is starting to spread throughout the economy,” said Joe Brusuelas, chief economist for the tax and business consultant McGladrey LLP.

Yet even though payrolls increased more than expected, U.S. stocks SPX, -1.11% were mixed in late Friday trading. Economists polled by MarketWatch had forecast 230,000 new nonfarm jobs.

In another good sign, average hourly wages jumped 0.5% in January to $24.75 after declining in December. That’s the biggest gain in six years.

Some 20 states increased minimum wage in 2015, partly contributing to the increase.

What’s more, hourly wages have risen 2.2% in the past 12 months, up from 1.9% in December and just a notch below a post-recession high. That’s nearly three times the rate of inflation, so workers are somewhat better off even though wage growth is still running well below it’s historical average.

The amount of time people worked each week also remained at a postrecession high of 34.6 hours. Hours rise when the economy strengthens and that helps pads the paychecks of nonsalaried employees.

The economy has now created at least 200,000 jobs for 12 straight months, a feat last accomplished in 1994-1995. And hiring shows little sign of slowing down despite weaker economic growth around the world.

With more cash in the hands of consumers, including the newly employed, the economy appears primed for the strongest year of growth since 2005 — the last time the U.S. grew by more than 3%. Consumer spending accounts for almost three-quarter of economic activity.

What could also fuel consumer spending in the months ahead is a huge drop in oil prices that pushed gasoline below $2 a gallon in many parts of the country. That’s freed up more money for households to spend on other U.S. goods and services instead of the dollars going to Canada, Mexico and other foreign oil suppliers.

For all the progress in the labor market, though, millions of Americans are still left out. Some 18 million people who want a full-time job still can’t find one, including 6.8 million workers who have been forced to work part-time instead.

If those people are taken into account, the nation’s unemployment rate is 11.3%. That’s still much higher than normal for an economy soon to enter its sixth year of expansion, underscoring the agonizingly slow pace of the recovery since the end of the Great Recession.