U.S. employment and the proportion of Americans in the labor force both showed strong growth in March, confirming perceptions that the labor market is recovering steadily from the recession.

Nonfarm payrolls rose by 215,000 last month, the Labor Department reported on Friday, capping the best two-year period for hiring since the late 1990s. The workforce participation rate, or the share of working-age Americans who are employed or at least looking for a job, rose a tenth of a percentage point to a two-year high of 63%.

While the unemployment rate rose in March rose to 5.0% from an eight-year low of 4.9%, economists said that was a healthy sign, reflecting more people looking for work after dropping out of the job market.

“It’s really a best-case scenario,” Michelle Meyer, deputy head of United States economics at Bank of America Merrill Lynch, told the New York Times. “I was particularly encouraged by the pickup in labor force participation.”

Scott Clemons, chief investment strategist at Brown Brothers Harriman, noted that hiring and wage gains were healthy in March, but not so robust as to ignite inflation fears and tempt the Federal Reserve to move more quickly to raise interest rates and temper growth.

The Fed has said it is continuing to take a cautious approach to monetary policy, with another rate hike unlikely before June.

“The underlying strength apparent in the [jobs] report for March reinforces growing evidence that the economy, despite a host of remaining ills, is now consistently moving in the right direction,” the Times said.

The labor force grew from 158,890,000 in February to 159,286,000 in March. With job openings at a high, workers are coming in from the margins, according to Andrew Chamberlain chief economist at job site Glassdoor. “In my view we are still at full employment,” he told Forbes.

Other data on Friday showed manufacturing activity expanded in March for the first time in six months as new orders surged. “The economy is not great, but it’s not falling off a cliff either,” Michael Feroli, an economist at JPMorgan, told Reuters.

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