In a stunning reverse, private employers added just 126,000 jobs to payrolls in March, the worst monthly gain since December 2013 and a bog miss from analyst expectations.

Worsening matters, February’s print of 239,000 was revised down to 201,000. Over the prior 12 months, employment growth had averaged 269,000 per month. 

With February’s revision, the combined January and February totals are down 69,000 from the initial reports.

This puts job creation for the first quarter at an average and weak 197,000 per month, raising questions about the Federal Reserve’s commitment to raising interest rates by mid-2015 or by the end of the third quarter.

“Today's disappointing job report supports our annual theme of The Economy Drags Housing Upward, in that we believe the economy must improve before we see significant improvement in housing. The report suggests that, through the first quarter, the economy isn't picking up from an income growth perspective, which in our view is a key missing factor in housing growth,” said Doug Duncan, chief economist at Fannie Mae. “The downside-surprise report—featuring the weakest monthly gain in nonfarm payrolls since the end of 2013 and large downward revisions—reinforces a loss in momentum already witnessed in other recent data, including consumer spending and manufacturing. While average hourly earnings picked up 0.3%, the year-over year rise of 2.1% showed no signs of a break-out from its trend over the past two years.

“These developments reaffirm the Fed’s desire to err on the dovish side. We remain comfortable with our call that the fed funds rate lift-off will occur in September. The setback in the hiring picture is in line with consumer sentiment regarding the housing market from the Fannie Mae National Housing Survey. The March survey, to be released on Monday, is expected to show a marked deterioration in consumers’ assessment in some key areas of the housing market amid a jump in the share of consumers believing that mortgage rates will go up,” Duncan said.

Employment in professional and business services trended up in March (+40,000). Job growth in the first quarter of 2015 averaged 34,000 per month in this industry, below the average monthly gain of 59,000 in 2014. Within professional and business services, employment continued to trend up in architectural and engineering services (+4,000), computer systems design and related services (+4,000), and management and  technical consulting services (+4,000).

Employment in other major industries, including construction, manufacturing, wholesale trade, transportation and warehousing, information, financial activities, and government, showed little change over the month.

In March, average hourly earnings for all employees on private nonfarm payrolls rose by 7 cents to $24.86. Over the year, average hourly earnings have risen by 2.1 percent. Average hourly earnings of private-sector production and nonsupervisory employees rose by 4 cents to $20.86 in March.