Cambridge Health will operate with Beth Israel

The financially strapped Cambridge Health Alliance has signed an agreement for a clinical and academic affiliation with Beth Israel Deaconess Medical Center in a bid to enhance care and cut costs.

"In this era of global payments, declining reimbursements and increased competition, it is more important than ever for CHA to join forces with a larger system and be part of a larger (accountable care organization)," CHA CEO Patrick Wardell said in a letter to employees yesterday. "Securing a strategic partner is one of our top organizational priorities, along with financial sustainability and improving patient experience of care."

CHA will remain independent with its own governance structure. The health-care system operates three "safety net" hospitals, so-called because of the large numbers of low-income patients treated: the city-owned Cambridge Hospital, Somerville Hospital and Whidden Memorial Hospital in Everett.

Next January, CHA and its doctors will join the Beth Israel Deaconess Care Organization, an accountable care organization (ACO) formed this year by Beth Israel and Harvard Medical Faculty Physicians.

The CHA-Beth Israel affiliation is part of a growing trend of consolidation among health-care providers that's driven by the increasing number of Medicare and Medicaid patients being treated for care and government underpayment for the services, according to Lynn Nicholas, CEO of the Massachusetts Hospital Association.

An ACO is a group of health-care providers that shares responsibility for cost and quality of care. The federal Affordable Care Act allows Medicare to reward ACOs for improving care and reducing costs. And state legislation signed last year to aggressively reduce health-care costs also rewards providers who shift to new non-fee-for-service payment methods.

"The new forms of payment systems that we are developing in the commonwealth require infrastructure and investment (and) more coordination of care," Nicholas said. "Many providers believe that they need size and scale to be most effective in that regard to mitigate the risks."

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Economists: U.S. job growth remains anemic

The U.S. economy likely received a much-needed dose of job growth last month thanks to a strong housing market and consumer spending, yet experts were divided yesterday over how high the tally would be given March's less-than-stellar figures.

Robert Nakosteen, an economics professor at the University of Massachusetts at Amherst's Isenberg School of Management, anticipated 150,000 jobs would be added, citing the 324,000 Americans who sought unemployment aid last week, the nation's lowest figure in five years.

"The problem in the economy is firms have pretty much stopped firing people, but haven't really started hiring them again," Nakosteen said. "At the same time, the economy is inherently healthier with household debt diminishing."

Yet federal budget cuts, increased payroll taxes and slowdowns in Europe and Asia continue to suppress the U.S. economy, which should be adding jobs at a rate of at least 250,000 jobs a month, Nakosteen added.

Preliminary figures released last month show the nation added a paltry 88,000 jobs in March, the country's worst figure since June 2012. While the unemployment rate dropped to 7.6 percent last month, nearly 500,000 people dropped out of the workforce.

The economy grew at an annual rate of 2.5 percent in the first three months of the year.

"One bright spot is spending has held up OK and if that strength persists then maybe things won't be that bad," said Ken Kuttner, an economics professor at Williams College. "Given the recovery of the housing market there's some possibility that employment in the housing sector can move that up a little bit. If you're looking for reasons to be optimistic, those are places I'd be looking."

Kuttner added a "good report" would be 150,000 jobs or higher added in April but "we will likely undershoot that and be closer to 100,000."

Northeastern University economist Alan Clayton-Matthews said today's report would likely reflect payroll provider ADP's modest figure of 119,000 jobs added last month.

"It won't be disappointing given the increased payroll tax and the sequestration. In fact, what it would be suggesting is that this burgeoning consumer demand and private sector demand is offsetting the fiscal drag," he said. "Once we take the hit on growth … we'd be poised to grow at a faster rate in the second half of the year."

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B&N to add Google Play app store to its Nook HD

NEW YORK — Barnes & Noble is teaming up with Google to vastly increase the number of apps available on its Nook HD tablets.

The bookstore chain says it will add Google's Play app store to its 7-inch Nook HD and 9-inch HD+ products in the U.S. and U.K. via a software update Friday. The move expands the number of apps available from the roughly 10,000 the Nook already offered in its own store — such as Angry Birds and Netflix — to 700,000-plus apps and games offered on Google Play. And it comes after a weak holiday sales season for the Nook, which is struggling to gain market share in the rapidly expanding tablet market.

CEO William Lynch said research and sales during the holidays show that consumer preference is shifting toward all-purpose tablets rather than simple e-readers.

"We saw coming off holiday the market moved to multifunction tablets," he said. "Consumer research showed us the breadth of applications available is really critical."

Lynch said the company had been in discussions with Google "on and off" for the past several years.

"This addresses the one perceived gap that we had with other tablets virtually overnight," he said. Terms of the deal were undisclosed.

The update is automatic and will occur over-the-air to all devices connected to Wi-Fi. It will also include other Google Inc. services like the Chrome browser, Gmail, YouTube and Google Maps. Google Play Music includes millions of songs as well.

The prices and styles of the Nooks that Barnes & Noble offers are not changing. The 7-inch Nook HD starts at $199 and the 9-inch Nook HD+ tablet starts at $269. Barnes & Noble also sells non-tablet e-book readers, the Nook Simple Touch and Nook Simple Touch with GlowLight, which will not offer Google Play.

Barnes & Noble Inc., based in New York, has invested heavily in its Nook e-book readers and a digital library as more readers shift to electronic books and competition has grown from discount stores and online rivals.

The retailer launched high-definition versions of its Nook HD and Nook HD+ tablets in September in an effort to better compete against Amazon.com's Kindle Fire as well as other tablets like the iPad, iPad Mini and Google's own Nexus 7.

The company's Nook unit has attracted investors — Microsoft Corp. owns 16.8 percent, while U.K. publisher and education company Pearson PLC has a 5 percent stake. But aside from investor funding, it has not been profitable. In its most recent quarter, which included the holiday season, Nook revenue fell 26 percent to $316 million. Barnes & Noble recorded $21 million in returns due to weak demand during the holiday season, and $15 million in allowances for promotions.

Meanwhile market share has slid. Barnes & Noble had a 1.9 percent share of the worldwide tablet market in the fourth quarter, making it the No. 5 Tablet player behind Apple, Samsung, Amazon and Asus, according to data from IDC. But by the first quarter it had slipped out of the top 5, replaced by Microsoft.

At the same time, competition is proliferating, with the global tablet market growing quickly. It more than doubled to 49.2 million units during the first quarter, according to IDC's estimate.

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Casinos brace for impact of Internet gambling

ATLANTIC CITY, N.J. — With legal gambling now moving beyond the casinos and onto the Internet, the industry is bracing for the most far-reaching changes in its history.

A Las Vegas firm, Ultimate Gaming, on Tuesday became the first in the U.S. to offer online poker, restricting it, for now, to players in Nevada. New Jersey and Delaware also have legalized gambling over the Internet and expect to begin offering such bets by the end of this year.

And many inside and outside the industry say the recent position taken by the federal government that states are free to offer Internet gambling — as long as it doesn't involve sports betting — will lead many cash-hungry state governments to turn to the Web as a new source of tax revenue.

Ten other states have considered some form of Internet gambling so far this year, but none has legalized it yet. Efforts to pass a national law legalizing online poker have sputtered, leaving states free to pass laws as they see fit.

"It's no longer a question of if Internet gaming is coming; it's a question of when," said Frank Fahrenkopf, president of the American Gaming Association, the trade organization for the nation's commercial brick-and -mortar casinos. "Unless there is a federal bill passed, we are going to have the greatest expansion of legalized gambling in the United States. I don't think that's what anyone intended, but it is what we're seeing."

The brave new world for gambling brings with it a host of questions and concerns. Will letting people bet online result in fewer visits to casinos, and therefore fewer dealers, beverage servers and hotel and restaurant workers at the casinos? Will Internet bets create a new revenue stream from new players, or will it simply redirect money from gamblers who otherwise would have visited a casino, and might have eaten dinner and seen a show, as well? And will it create even more problem gamblers?

Michael Frawley is chief operating officer of The Atlantic Club Casino Hotel, perhaps the most endangered of Atlantic City's 12 casinos. A deal for it to be sold to the parent company of PokerStars, the world's largest online poker website, is up in the air. The Atlantic Club's owners said Wednesday the deal was dead, but PokerStars said the next day it still wants to salvage the purchase. It was not immediately clear whether the deal will ultimately get done.

Frawley said the Internet's vast reach could help double business at his casino, provided the right balance is struck between the online and physical gambling experiences for customers.

"If you go to the movies, you can watch one at home, or you can watch one in the theater," he said. "Both of them can be a great experience."

Regardless of whether PokerStars buys The Atlantic Club, Internet gambling is expected to take off in New Jersey before long. The Borgata Hotel Casino & Spa has said it is preparing to offer online gambling later this year, and Gary Loveman, CEO of Caesars Entertainment, has also said he expects his company's four Atlantic City casinos to grab a large share of New Jersey's online market.

Geoffrey Stewart is general manager of Caesars Online Poker. Parent company Caesars Entertainment's World Series of Poker brands, as well as its 37 casinos across the U.S., make it an early favorite to be a leader in online gambling. He said brick-and-mortar casinos such as Caesars Palace can use Internet play to complement their physical casinos.

"Someone comes to play with us online, we will be able to offer them seats to the real World Series of Poker, or offer them hotel rooms at Caesars Palace," he said. "Like any other business, you're always looking for what is the next distribution channel."

Not everyone in the industry is all-in, however.

The American Gaming Association conducted a study a few years ago on whether poker-only Internet gambling — which it supports — would cannibalize the existing brick-and-mortar casinos. The study determined that it would not. But when Internet gambling allows for casino games, such as in the bill recently adopted by New Jersey, the traditional casinos could suffer, Fahrenkopf said.

The most popular form of Internet gambling is online poker.

When the Justice Department charged executives of three online poker sites in April 2011 with conducting illegal transactions, it was a $6 billion a year industry. After the crackdown, it was largely on hiatus, because at the time, taking online bets from U.S. customers was illegal. But not long afterward, the U.S. Justice Department revised its stance, allowing states to take online bets so long as they didn't involve sporting events.

Eric Baldwin is a professional poker player who's eager to get back online again now that poker is once again available over the Net.

"The money's good when things are good," he said. On the other hand, he acknowledges, "Most people don't go to work for 12 hours, do their best and come home down a couple thousand dollars."

He plans to at least try out legalized Internet poker to see if the player pools are big enough to make it worthwhile.

Lawrence Vaughan, chief operating officer of South Point Poker, one of the first Nevada online licensees, said legalizing Internet poker removes the stigma some people had associated with it.

"You had to move money in shady ways around the world to even play online," he said. "Now it's the sort of thing your mom could sign up for."

Ultimate Gaming CEO Tobin Prior, whose firm started taking poker bets Tuesday in Nevada, added, "Players won't have to worry if their money is safe. They are going to be able to play with people they can trust and know the highest regulatory standards have been applied."

PokerStars, one of the parties charged in the 2011 crackdown that came to be known in the industry as "Black Friday," later bought Full Tilt Poker, another defendant, and reached a settlement with the federal government, paying $547 million to the Justice Department and $184 million to poker players overseas to settle a case alleging money laundering, bank fraud and illegal gambling. It admitted no wrongdoing and says it is in good standing with governments around the world.

Its parent company, The Rational Group, based on the Isle of Man in the U.K., would not say whether it plans to try to buy another casino or partner with one to gain entry into the U.S. online gambling market.

Introducing new players to poker over the Internet makes it less scary and potentially more popular, said David Schwartz, director of the Center for Gaming Research at the University of Nevada Las Vegas.

"It was mostly old guys with cigars," he said. "It was very intimidating to walk into a poker room and see a guy who's a thousand years old, smoking 10 packs of cigarettes a day, giving you dirty looks because you're taking the wrong card," he said. "What online poker did was let people get familiar with the game, feel a little bit of confidence and then they said, 'I want to go to Vegas and do the real thing.'"

Every week, it seems, a new study comes out touting the promise of Internet gambling for cash-strapped casinos and even more cash-strapped state governments.

Gambling Compliance, which tracks the online gambling industry, predicts Internet gambling in New Jersey will bring in nearly $262 million in its first year and nearly $463 million after four years. The group said that figure could go as high as $575 million after four years if online gambling takes off in New Jersey.

H2 Gambling Capital, a U.K. consultancy for the Internet gambling industry, predicts 17 states will have approved Internet gambling by 2017, led by New York, California, Florida, Illinois and New Jersey.

And Morgan Stanley predicts that by 2020, online gambling in the U.S. will produce the same amount of revenue as Las Vegas and Atlantic City markets combined bring in today: $9.3 billion.

Indian tribes are also moving to get into the online gold rush.

Two groups of tribes have already formed alliances to explore offering Internet gambling, and in April, the Cheyenne-Arapaho Tribe reached a deal with Oklahoma allowing the tribe to offer Internet gambling to customers outside the U.S. through its pokertribes.com web site. The Shoshone tribe in Nevada has a deal with an online company to offer similar Internet gambling to foreign customers in a venture that could go live in May.

States across the country are also turning to the Internet to boost sales of their lottery tickets. Twelve states have either approved or are considering selling lottery tickets online, and Georgia and Illinois are already doing it.

What types of games can be played for money online varies by state.

New Jersey will offer people within the state all the games patrons can play in physical casinos. Delaware will do the same, along with bingo. Nevada only offers poker. A proposed Internet betting law in Massachusetts would prohibit online slot machine games.

But in most cases, the games can be accessed through computers, portable tablet devices and smartphones — putting a casino or a card game within reach at 3 a.m. in the kitchen, in the middle of the day at the beach, or on a crowded commuter train.

With the Internet putting legal gambling directly into so many more hands, some are concerned about an increase in problem gambling, particularly when social media sites offer real-money gambling in the U.S., as some do already in other countries. Zynga, for instance, began taking real-money bets earlier this year in England, and its stock price jumped 15 percent in a day.

"Compulsive gambling is an impulse disease: you get an urge, you jump in your car and drive to Atlantic City or you call your bookie and then wait to see the result of the game you bet on," said Arnie Wexler, the former chairman of New Jersey's Council On Compulsive Gambling and himself a recovered problem gambler. "Now you have Internet gambling and you wake up in the middle of the night and in your birthday suit, you can blow a lot of money. I know one guy who lost $30,000 in one night of Internet gambling."

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Associated Press writer Haven Daley in Las Vegas contributed to this report. Wayne Parry can be reached at http://twitter.com/WayneParryAC

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Outgoing Alibaba CEO Ma says he's 'old' for Web

SANTA MONICA, Calif. — Alibaba founder Jack Ma, the billionaire who has run the Chinese e-commerce giant since 1999, says he's getting "a bit old" for the Internet.

That's what the outgoing chief executive told a charitable event in Santa Monica Thursday as he pledged $5 million toward a China-based fund that supports environmental conservation projects outside China.

"I'm young for new things but I'm a bit old for the Internet," the 48-year-old said.

Ma's gift doubles the amount raised for the China Global Conservation Fund, an offshoot of the Arlington, Va.-based organization, The Nature Conservancy.

Ma steps down as CEO from Alibaba Group on May 10, ahead of a widely expected initial public offering of stock that could create a windfall for Yahoo Inc., which owns nearly a quarter of the company.

Ma said that he prepared for his retirement for the last nine years and is looking forward to working on philanthropic causes such as environmental conservation.

He said he was inspired to act after visiting his home in China six years ago. A lake he nearly drowned in as a boy had mostly dried up. He also spoke to a farmer who used chemicals on produce that he wouldn't feed his family. "I know something is wrong," Ma said.

Ma will chair the Chinese board overseeing the fund once he steps down as CEO.

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Nation adds 165,000 jobs in April; unemployment rate 7.5 percent

Total nonfarm payroll employment rose by 165,000 in April, and the unemployment rate was little changed at 7.5 percent, the U.S. Bureau of Labor Statistics reported today.Over the prior year, employment growth has averaged 169,000 per month.

Employment increased in professional and business services, food services and drinking places, retail trade, and health care.

Previous estimates for the number of jobs created in February were revised upward from 268,000 to 332,000, and the change for March was revised from a very disappointing 88,000 to 138,000. With these revisions, employment gains in February and March combined were 114,000 higher than previously reported.

The unemployment rate, at 7.5 percent, changed little in April but has declined by 0.4 percentage point since January. The number of unemployed Americans, at 11.7 million, was also little changed over the month; however, unemployment has decreased by 673,000 since January.

The unemployment rate for adult women (6.7 percent) declined in April, while the rates for adult men (7.1

percent), teenagers (24.1 percent), whites (6.7 percent), blacks (13.2 percent), and Hispanics (9 percent) showed little or no change. The jobless rate for Asians was 5.1 percent, little changed from a year earlier.

In April, the number of long-term unemployed (those jobless for 27 weeks or more) declined by 258,000 to 4.4 million; their share of the unemployed declined by 2.2 percentage points to 37.4 percent. Over the

past 12 months, the number of long-term unemployed has decreased by 687,000, and their share has declined by 3.1 percentage points.

The civilian labor force participation rate was 63.3 percent in April, unchanged over the month but down from 63.6 percent in January.

In April, the number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) increased by 278,000 to 7.9 million, largely offsetting a decrease in

March. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.

In April, 2.3 million persons were marginally attached to the labor force, essentially unchanged from a year earlier. These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the four weeks preceding the survey.

Among the marginally attached, there were 835,000 discouraged workers in April, down by 133,000 from a year earlier. Discouraged workers are not currently looking for work because they believe no jobs are available for them. The remaining 1.5 million persons marginally attached to the labor force in April had not searched for work in the four weeks preceding the survey for reasons such as school attendance or family responsibilities.

Professional and business services added 73,000 jobs in April. Within leisure and hospitality, employment in food services and drinking places rose by 38,000. Retail trade employment increased by 29,000 in April.

Health care added 19,000 jobs.

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

The average workweek for all employees on private nonfarm payrolls decreased by 0.2 hour in April to 34.4 hours. Within manufacturing, the workweek decreased by 0.1 hour to 40.7 hours, and overtime declined by 0.1 hour to 3.3 hours.

In April, average hourly earnings for all employees on private nonfarm payrolls rose by 4 cents to $23.87. Over the year, average hourly earnings have risen by 45 cents, or 1.9 percent.

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Warren Buffett says economy still improving slowly

OMAHA, Neb. — Investor Warren Buffett believes that the economy and the U.S. job market will continue to improve, but slowly.

In an interview that aired Friday, Buffett said business has been creeping upward at his Berkshire Hathaway conglomerate.

"The economy is improving, not at a rapid clip, but this country has done well since 2008 — certainly compared to the rest of the world," Buffett said to CNBC.

Buffett thinks it would be extraordinary if the Federal Reserve were to expand its bond-buying program beyond the current $85 billion a month level. The Fed said Wednesday that it would consider buying more if the economy needs help.

Fed Chairman Ben Bernanke needs some help from elsewhere to get the economy moving faster, Buffett said. Bernanke has urged Congress to do more to stimulate hiring and growth.

On Saturday, Buffett will take questions in front of more than 30,000 people at Berkshire's annual meeting.

In a separate interview with the Fox Business Network on Friday, Buffett tried to reassure Berkshire shareholders that they shouldn't worry about his successor.

The 82-year-old billionaire said he isn't concerned about who will next lead four companies in which Berkshire invests nearly $50 billion, such as Coca-Cola, IBM, Wells Fargo and American Express.

"I don't know who's going to succeed the present CEOs there and in every case, each one of the four they have changed CEOs since we started buying the stock in certain cases more than once," Buffett said. "I never knew who they were going to be. I knew they'd pick good people."

Buffett said Berkshire's board spends more time discussion succession planning than any other topic. But Buffett has no plans to retire. He has said Berkshire's board has picked someone to succeed him as CEO if the need arises immediately, and it has two backup candidates. But Buffett won't publicly identify his successor, partly because he has said the candidates could change over time.

Currently, all of the CEO candidates on Berkshire's short list are men, but Buffett said that could change.

"Maybe 10 years or 15 years from now it will be a she. I hope it is," he said.

Berkshire plans to split Buffett's job into three parts when he no longer leads the company. The next CEO will run Berkshire, but two others hired by Buffett in recent years will oversee investment. Buffett wants his oldest son to succeed him as chairman.

Berkshire owns more than 80 subsidiaries, including railroad, clothing, furniture and jewelry firms. Its insurance and utility businesses typically account for more than half of the company's net income. The Omaha, Neb., company also has major investments.

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Follow Josh Funk online at www.twitter.com/funkwrite

___

Online:

Berkshire Hathaway Inc.: www.berkshirehathaway.com

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Pentagon clears use of Samsung's devices

SEOUL, South Korea — Samsung Electronics Co. says the U.S. Department of Defense has approved using Samsung smartphones for its networks.

The South Korean company said Friday the Galaxy S4 smartphone has become the first Android device to meet the security requirements set out by the U.S. government, allowing government and military officials to access the Defense Department's networks with the S4.

Samsung is making a big push to enter the smartphone market for governments and enterprises dominated by Research In Motion Ltd.'s BlackBerry devices.

Earlier this year, Samsung announced software for security-conscious users called Samsung Knox aimed at people who want to use their personal mobile devices to access secured networks at the workplace. Samsung said Knox is only available with the S4 and will be installed in other Samsung devices later.

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Strong US jobs report triggers stock market rally

LONDON — Stock markets rallied on Friday, with both the Dow and S&P hitting new highs, after an unexpectedly strong U.S. jobs report indicated the world's largest economy is not slowing down, as some had feared.

The Labor Department said a net 165,000 jobs were created in April, above the market expectations for 140,000. The previous two months' weak figures, meanwhile, were revised up. That helped bring the unemployment rate down to 7.5 percent, the lowest in four years.

Paul Ashworth, the chief U.S. economist for Capital Economics, said the report "will go a long way towards soothing fears of another spring slowdown."

On Wall Street, the Dow was up 1.1 percent to 14,991.93, having earlier traded above the 15,000 mark for the first time. The broader S&P 500 was 1.2 percent higher at 1,616.89, also just off record highs.

In Europe, Germany's DAX rose 2 percent to 8,122.29, its highest ever closing price. Britain's FTSE 100 closed 0.9 percent higher at 6,521.46 while France's CAC-40 ended 1.4 percent higher at 3,912.95.

The U.S. jobs report helped offset news that the European Union had downgraded its economic forecasts. In its spring update, the EU said it expected the 17-country eurozone's economy to shrink 0.4 percent this year, 0.1 percentage points worse than its February prediction.

It expects markedly weaker growth in Germany, the region's biggest economy, and a contraction in France, the second-largest. The fact that the economic slowdown is affecting the larger economies could push the ECB to cut interest rates again, or provide some new measures of support to credit markets in coming months.

Earlier, in Asia, Hong Kong's Hang Seng rose 0.1 percent to close at 22,689.96. South Korea's Kospi rose 0.4 percent to 1,965.71 and Australia's S&P/ASX 200 was nearly unchanged at 5,129.50.

Mainland Chinese stocks posted sharp gains, but that was likely due to bargain-hunting after a sharp fall the day before. The Shanghai Composite Index jumped 1.4 percent to 2,205.5 while the Shenzhen Composite Index gained 2 percent to 936.58.

Markets in Japan were closed for a public holiday.

In commodity markets, the benchmark oil contract for June delivery was up $1.80 to $95.79 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $2.96, or 3.3 percent, on Thursday, the biggest one-day gain for crude since November.

In currencies, the euro rose 0.3 percent to $1.3110, recovering somewhat from sharp losses the day before, when the European Central Bank on Thursday cut interest rates. The dollar rose 1.2 percent against the Japanese yen, to 99.12 yen.

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Pamela Sampson in Bangkok contributed to this report.

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Stocks surge to new highs after hiring climbs

NEW YORK — A big gain in the job market is lifting the stock market to new milestones.

The Dow Jones industrial average crossed 15,000 for the first time early Friday, and the Standard and Poor's 500 index, a broader market measure, broke through 1,600 for the first time.

Shortly after 1 p.m. Eastern Daylight Time, the Dow had given up some of its early gain but was still up 170 points to 15,001, an increase of 1.1 percent. The S&P 500 index surged 19 points, or 1.2 percent, to 1,617.

The surge in U.S. hiring comes after weeks of conflicting signals about the strength of the global economy and the stock market's rise. The unexpectedly strong numbers gave investors new confidence, and eased some of their earlier concerns.

The government said U.S. employers added 165,000 jobs in April, more than economists were expecting. It also said more jobs were created in February and March than it had estimated earlier. The unemployment rate also fell to 7.5 percent, the lowest in four years, from 7.6 percent the month before.

"We're breaking through psychological barriers and that will continue to bring investors off the sidelines," said Darrell Cronk, regional chief investment officer for Wells Fargo Private Bank. He called the jobs news "wonderful."

When the jobs numbers were announced at 8:30 a.m., stock-market futures surged and price of crude oil quickly jumped as traders anticipated a pickup in the economy and rising demand for energy. Oil rose $1.68 to $95.68 a barrel.

The yield on the benchmark 10-year Treasury note jumped from its lowest level of the year, as traders moved money out of the safety of government bonds. The yield rose to 1.73 percent from 1.63 percent late Thursday.

The stock market gains were led by companies that stand to benefit most from an upturn in the economy. Industrial companies, those that make basic materials, and produce oil and gas rose the most in the S&P 500 index. Utilities, consumer-staple companies and other safe-play stocks trailed the market as investors took on more risk.

Small-company stocks are more risky than bigger companies but can also offer investors greater returns. On Friday, they rose at nearly double the pace of the broader market. The Russell 2000 was up 2 percent at midday, much more than the S&P 500, which tracks large company stocks.

The Nasdaq composite index gained 47 points to 3,387, an increase of 1.4 percent.

First came news of falling retail sales in March, then a series of weak manufacturing reports and signs of an economic slowdown in China.

The first-quarter earnings season has been mixed, too. Though earnings have been higher than expected, many companies have reported little or no revenue growth, which has spooked investors.

Investors have also worried that higher Social Security payroll taxes and sweeping government spending cuts that took effect earlier this year will slow U.S. economic growth, and hurt on corporate profits.

Friday's jobs numbers suggested the private sector might be strong enough to overcome those various obstacles.

In its report, the government revised its previous estimate of job gains up to 332,000 in February and 138,000 in March. The economy has created an average of 208,000 jobs a month from November through April — above the 138,000 added in the previous six months.

Among other stocks making big moves:

— Gilead Sciences jumped $3.30 to $55.47, a gain of 6 percent. The maker of HIV drugs reported a 63 percent surge in income in the first quarter thanks to lower costs and increased sales.

— Kraft Foods rose $3.43 to $53.95, an increase of 7 percent. The food maker reported first-quarter income and revenue that beat the forecasts of Wall Street analysts as it increased sales and cut costs following its split from its global snack business.

— LinkedIn, the professional networking social media site, sank 10 percent, losing $20.30, to $181.27. The company issued a revenue forecast for the rest of the year that was well below what financial analysts were expecting. LinkedIn went public in May 2011 at $45 a share.

The S&P 500 is up 13 percent from the start of the year. The Dow is up 14 percent.

Stock overseas rose on U.S. jobs report, too. The main indexes in France, Germany, Spain and Brazil rose 1 percent of more. Markets in Japan were closed for a public holiday.

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