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"Undoubtedly, there was some catch up in hiring following the inclement weather this winter," said Kathy Bostjancic, director of macroeconomic analysis at The Conference Board. "Still, the underlying hiring trend is encouraging, with more good news expected this spring and summer."
In showing improvement, the number also boosts the case for the Federal Reserve to continue reducing the pace of its monthly asset purchase program. The U.S. central bank has knocked down its quantitative easing program to $55 billion a month, from $85 billion.
Economists expected that U.S. firms created 200,000 jobs in March, with the unemployment rate edging lower to 6.6 percent.
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"Overall, now that the weather-related weakness is behind us, we anticipate that the monthly gains in payroll employment will remain close to the 200,000 mark, driving the unemployment rate gradually lower and allowing the Fed to continue winding down its monthly asset purchases," Paul Ashworth, chief U.S. economist at Capital Economics, said in a note.
Financial markets thought little of the report, with stocks finding yet another record high and government bond yields edging lower.
A separate measure that includes discouraged and underemployed workers inched higher to 12.7 percent.
Economists were watching the report for indications beyond simple job growth. February showed a nine-cent gain in average hourly earnings, but in March that number actually dropped by a penny, indicating that outright wage inflation has yet to take full hold.
However, the average work week increased by 0.2 hours to 34.5 hours, indicating that pressures remain.
"The rise in payroll jobs is not telling the full story," said Stu Hoffman, an economist at PNC. "Wages were flat but the work week jumped two-tenths of an hour, which speaks to the fact that weather in January and February not only kept people off the job but also held back the amount of time they spent when on the job."
Professional and business services led the pace of job growth with 57,000 new positions, with temporary positions increasing by 29,000. Restaurant and bars added 30,000, while health care contributed 19,000. Government hiring was essentially flat, with 9,000 positions lost at the federal level and state the local governments adding 8,000.