By Ben Leubsdorf 

Workers' wages picked up in March, but signs of the long-awaited acceleration in American paychecks remain elusive.

Average hourly earnings of private sector workers rose last month by 7 cents to $24.86, the Labor Department said Friday. The 0.3% increase, which was a bright spot in a broadly weak jobs report, followed a tepid 0.1% rise in February.

But monthly readings can be volatile, and the trend remains muted. Hourly earnings in March rose 2.1% from a year earlier, little changed from their 2% annual pace over the past half-decade.

"I don't think we've seen enough evidence yet to make the call" that the wage picture is now notably improving, Barclays chief U.S. economist Michael Gapen said.

For months, many economists have predicted that wage growth would accelerate because a tighter labor market means employers are facing increased competition to hire and retain workers. There have been nascent signs of a pickup, including recent pay-raise announcements by big employers like Wal-Mart Stores Inc., Target Corp. and McDonald's Corp.

Those moves, most of which have yet to kick in, have heightened the competition for low-skilled workers, said Tom Hudson, chief executive of Nth/Works, a company in Louisville, Ky., that makes metal parts for automotive and appliance manufacturers.

Mr. Hudson said he's nearly doubled his staff since early 2012, to 385 today, and hasn't found it difficult to hire production workers at $10 to $12 an hour. But "ultimately, we're going to have to end up raising wages to stay competitive," he said. "We're on the cusp of doing so."

Other companies aren't feeling that pressure yet.

Charles Schwab Corp. hired more than 900 people last year to fill new and existing positions at offices around Colorado, including a newly built campus in the Denver suburb of Lone Tree.

The Colorado labor market is "getting more competitive," said Brian McDonald, the financial-services firm's senior executive in the state. But it hasn't tightened to the point where big pay raises are needed to attract applicants.

"We're hearing of more counteroffers," Mr. McDonald said, but "we haven't made wholesale changes to our entry-point salaries."

Mr. Gapen said he thinks wages will pick up later this year as the U.S. unemployment rate, which was steady at 5.5% in March, falls toward the Federal Reserve's long-run target range of 5% to 5.2%.

"I'm not disturbed by not seeing it yet," he said. "But the closer we get to 5% on the unemployment rate and we don't see it, you start to get a little concerned."

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