The numbers: American businesses and other employers created the fewest new jobs in February in 17 months, the latest sign of a broader slowdown in the U.S. economy.

The economy added just 20,000 new jobs last month, the smallest gain since September 2017, the government said Friday.

The number of new nonfarm jobs created last month was well below the 172,000 MarketWatch forecast, but the slowdown was probably exaggerated by heavy snow and other seasonal oddities that are unlikely to persist. The U.S. has been adding more than 200,000 new jobs a month for the past year.

Hiring sputtered in February in construction, retail and shipping and was muted in most other industries.

The pace of hiring is still strong enough, however, to keep downward pressure on the nation’s unemployment rate, especially in a tight labor market in which good help is hard to find.

The jobless rate slipped to 3.8% from 4%, aided by the return of government workers after the end of the partial federal shutdown in January. Last year unemployment fell to a half-century low of 3.7%.

An ultra-tight labor market, what’s more, is forcing companies to offer better pay and benefits to attract or retain workers. The amount of money the average worker earns jumped 11 cents an hour to $27.66 last month.

The increase in pay in the past 12 months climbed to 3.4%, the biggest gain since the end of the last recession in 2009. While faster pay might spark fresh worries about inflation, so far there’s little sign that higher labor costs have done much if any harm.

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What happened: The biggest dropoff in hiring in February took place in construction, where employment fell 31,000 after a 53,000 increase in January. The sharp swing in construction employment is likely evidence that government statisticians had trouble with seasonal adjustments.

A similarly large swing took place among hotels and restaurants, whose employment was flat in February after an outsized 89,000 increase in January that was the second largest in the past 20 years.

Retailers and shippers also cut jobs.

Hiring was strongest among professional firms and health-care companies. Professional firms created 42,000 new jobs and health providers added 21,000 jobs. Those have been the fastest growing industries through the nearly 10-year-old expansion.

Economists figure the U.S. needs to add about 100,000 jobs a month to absorb the number of people entering the labor force — immigrants, high school and college grads, moms or retirees going back to work. The labor force has been growing more slowly because of an aging population and tighter immigration restrictions, among other things.

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Big picture: The U.S. is not growing as fast as it was last summer and companies might be more cautious about hiring, but the economy is not about to fall into a ditch despite what the February jobs report seems to indicate.

Read:‘Don’t hit panic’ — economists say jobs report wasn’t as bad as it looked

A chief reason is the strong labor market: Wages are rising, unemployment and layoffs remain near a half-century low and job openings are at a record high.

So long as consumers are working and spending, companies are unlikely to see the kind of hiccup in sales that would force them to slash jobs. Their biggest worry right now is a slowing global economy that’s crimped exports, but if the U.S. and China strike a deal and end a damaging dispute over trade, it could go a long way in easing some of those worries.

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What they are saying: “Bizarre swings in the economic data have become routine since the end of the government shutdown and today was no exception,” said Thomas Simons, senior money market economist at Jefferies LLC. He said the 166,000 average of job gains in the first two months of 2019 are a more accurate reflection of underlying hiring trends.

“One poor report should not set off alarm bells, but given that the labor market is the linchpin for the entire economy, it does add to existing concerns and raises the stakes for next month’s report,” said Curt Long, chief economist at National Association of Federally-Insured Credit Unions.

Market reaction: The Dow Jones Industrial Average DJIA, -0.39% and S&P 500 SPX, -0.78% fell sharply in Friday trades.