(CNNMoney) — Hiring slowed sharply in March, with the economy adding only 88,000 jobs, the lowest monthly gain since last June.

The unemployment rate slipped to 7.6%, according to a Labor Department report released Friday. But it’s not good news: It’s because nearly 500,000 people dropped out of the labor market.

Economists surveyed by CNNMoney were expecting an increase of 190,000 jobs in March. They had expected the unemployment rate to hold steady at 7.7%.

The monthly jobs data concluded a week of downbeat labor market news.

A report Thursday showed that initial unemployment claims jumped 28,000 for the week ending March 30.

On Wednesday, payroll processor ADP said that private sector hiring had slowed in March, due in large part to a slowdown in construction.

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