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Jobs surge latest sign of upswing in Mass.

By Robert Gavin
Globe Staff / May 21, 2010

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The economic recovery in Massachusetts gained traction in April, as employers added jobs at the fastest pace in nearly two decades and the jobless rate fell for the second consecutive month.

The surge in jobs, analysts said, is the latest and perhaps strongest evidence yet that the state has begun a self-sustaining recovery, in which growing employment leads to higher incomes, increased spending, and more hiring.

“This is super, surprising, good,’’ said Alan Clayton-Matthews, economics professor at Northeastern University. “It’s hard to believe that these job numbers are all real, but everything we are looking at supports positive and strong job growth.’’

Massachusetts companies expanded payrolls by nearly 20,000 jobs in April, the third consecutive monthly increase and the biggest gain since April 1993, the Executive Office of Workforce Development reported yesterday. The unem ployment rate slipped to 9.2 percent from 9.3 percent in March and 9.5 percent in February.

While April’s job growth could be overstated, since the data is based on a survey of businesses, analysts said it’s clear that the state’s economy is on an upward trajectory.

“These numbers may be too good to be true,’’ said Andre Mayer, senior vice president for research at Associated Industries of Massachusetts, an employer group. “But they still confirm that we are on positive trend.’’

Over the past few months, the state has added nearly 30,000 jobs as income and consumer spending have both grown at double-digit annual rates, according to Clayton-Matthews.

These trends are setting the stage for an expansion that could create more than 200,000 jobs over the next five years, according to a forecast released yesterday by the New England Economic Partnership, a nonprofit group of economists that follows the regional economy. The forecast projects the state will regain all the jobs lost in the recent recession by mid-2013, suggesting a stronger rebound for Massachusetts than it had after the two previous recessions.

“The state’s recovery appears to be firmly on track,’’ the forecast said. “Payroll employment should grow robustly in the second and third quarters.’’

The rebound here is tracking a national recovery that has created more than 500,000 jobs since the beginning of the year.

Despite yesterday’s stock market plunge, fueled by concerns over the European debt crisis and an unexpected increase in first-time claims for unemployment benefits, the nation appears to have entered a self-sustaining recovery, said Mark Zandi, chief economist of Moody’s Analytics, a forecasting firm in West Chester, Pa. First time jobless claims rose by 25,000 last week to 471,000.

Zandi, who presented a national forecast at the New England Economic Partnership’s semiannual conference, said strong corporate profits, improved competitiveness of US companies, and pent-up demand from consumers who put off purchases will drive the recovery.

He expects the nation to add an average of 125,000 jobs a month this year; 250,000 a month next year; and 300,000 in 2012. “Job creation is very broad-based,’’ said Zandi. “It seems to be for real.’’

At Hollister Inc., a Boston staffing firm, officials said companies are hiring permanent employees faster than expected for this stage of a recovery. Early on, employers tend to hire temporary workers until they become convinced that the economy is heading for a long-term rebound.

“The unusual thing is, permanent hiring is making a quicker comeback,’’ said Gillian Seely, Hollister’s spokeswoman. “Confidence is growing.’’

Among those hiring is Vistagy Inc., a Waltham firm that makes engineering software. The company, which employs more than 60 people in Massachusetts, has so far added two workers this year, with four new employees starting next month and at least five openings still to be filled, said chief executive Steve Luby.

“We’ve been very aggressively ramping up our hiring,’’ Luby said. “Business confidence began increasing last year, and we’ve had very solid growth so far this year.’’

In Tewksbury, WellPet LLC, a natural pet food maker that employs about 200 workers, is also experiencing solid sales growth. The company is now seeking to fill four job openings, including one posted just yesterday.

“It’s always a good problem to have,’’ said Kim Voulgaris, WellPet’s recruiting manager, “to need people, to be growing.’’

In Massachusetts, April job gains were spread across seven of 10 major sectors. In addition to stalwarts such as education and health care, and professional and business services, long-struggling industries posted strong gains. Construction, for example, added nearly 4,000 jobs.

Governor Deval Patrick hailed the job growth as evidence that his policies are working, but acknowledged that more needs to be done to bring down the state’s unemployment rate.

“We started four years ago and stuck with it, and it’s helping us to recover faster and stronger,’’ Patrick said. “But if you don’t have a job, you don’t care about statistics. We have to keep at it, keep working.’’

Charles D. Baker, Patrick’s Republican opponent in this year’s gubernatorial election, said Massachusetts still has a long way to regain the nearly 170,000 jobs lost in the recession.

“Any time people are getting back to work it’s good news,’’ Baker said. “But until we get serious about reforming and restructuring state government and services, taxpayers are not going to see the kind of turnaround they deserve.’’

State Treasurer Timothy P. Cahill, who is running as an independent, could not be reached.

Robert Gavin can be reached at rgavin@globe.com.