SACRAMENTO (AP) — California's recovery had a setback in March as unemployment inched back up to 11 percent after two months of decline, officials said Friday.

The rate increased just one-tenth of a percentage point last month from February, but it was the first time since December the jobless rate hit 11 percent, according to the state Economic Development Department.

The uptick in California contrasts with the national jobless rate, which fell one-tenth of a percentage point in March to 8.2 percent.

More than 2 million Californians remained unemployed in March. That figure increased by 19,000 since February but was down by 148,000 since March of last year.

The slight increase in California's unemployment rate came largely because 20,000 more people began looking for work in March, said Dennis Meyers, an economist for the state Department of Finance.

"It looks like people are a little more encouraged about work and entering the labor force," he said. "We're still slowly climbing out of the hole we dug."

California's rate in March was still nearly a full percentage point better than the 11.9 percent unemployment in the year-ago period.

The state reported that more than 18,000 nonfarm payroll jobs were created in March, bringing to nearly 386,000 the number of jobs gained since the recovery began in September 2009.

March marked the eighth consecutive month of increased payroll jobs in California, said Kevin Callori, a spokesman for the Economic Development Department.

"As far as payroll jobs, we actually are doing a little bit better than the nation," he said.

February's estimate of new payroll jobs was revised upward to 38,600, from an initial estimate of 4,000.

Leisure and hospitality led the way in March, adding nearly 14,000 jobs for the month.

Mining and logging, trade, transportation and utilities, financial activities, professional and business services, educational and health services and government also saw increases. The seven categories added a combined 37,800 jobs in March.

Construction, manufacturing, information and other services lost a combined 19,600 jobs last month.

Over the past year, government recorded the biggest losses, down 46,000 employees.

Professional and business services had the biggest increase in jobs, adding more than 66,000 for the year.

"That's some of the higher wage jobs, so that's a good sign," Callori said.