March jobs report shows hiring surge as businesses ease COVID-19 restrictions
Hiring surged across the U.S. in March as businesses lifted COVID-19 restrictions and more Americans received coronavirus vaccinations.
Employers added 916,000 jobs, the best month of job gains since August, the Labor Department said Friday. Leisure and hospitality led the payroll gains, adding 280,000 jobs last month as previously shuttered establishments reopened. Public and private education added 190,00 jobs and construction added 110,000.
"The better than expected 916,000 rebound in non-farm payrolls in March still leaves employment 8.4 million below its pre-pandemic peak from just over a year ago but, with the vaccination program likely to reach critical mass within the next couple of months and the next round of fiscal stimulus providing a big boost, there is finally real light at the end of the tunnel," Paul Ashworth, chief U.S. economist at Capital Economics, said in a note.
The nation's unemployment rate fell to 6%, from 6.2%, as more people succeeded in finding work. The unemployment rate for Asian workers rose to 6% from 5.1%; the rate fell for other major demographic groups, although unemployment for Black Americans remains high, at 9.6%. Revised figures also showed that hiring was stronger in January and February than initially estimated.
"March's jobs report is the most optimistic report since the pandemic began," Glassdoor senior economist Daniel Zhao said in a report. "While the pandemic is not over yet, the finish line appears close, and the economy is surging forward in a last sprint toward a full reopening."
What's driving jobs growth
Several factors contributed to job creation. Many states, fueled by optimism over the COVID-19 vaccines, have begun lifting restrictions on mass gatherings and eating and drinking places, leading formerly closed restaurants to reopen or expand their capacity. Strong demand for housing, coupled with warmer weather after a deep freeze in February, is driving job gains in construction. And large school districts across the country are re-starting in-person schooling.
No sector has fully recovered all the jobs lost since the pandemic hit last spring. But spending and other data show cause for optimism. Manufacturing grew in March at its fastest pace since 1983, according to a survey from the Institute for Supply Management. And the $1,400 stimulus checks in President Joe Biden's $1.9 trillion economic relief plan have sharply increased consumer spending, according to Bank of America's tracking of its debit and credit cards. Spending jumped 23% in the third week of March compared with pre-pandemic levels, the bank said.
Americans are increasingly willing to venture out from home to travel. Roughly 1.5 million people traveled through airports on March 28, according to the Transportation Services Administration. That was roughly eight times the figure of a year ago, although it was still down sharply from 2.5 million on the same day in 2019.
Stronger economy ahead?
Most economists expect hiring to surge in the months ahead as businesses reopen and expand to take advantage of consumers' newfound desire to spend. IHS Markit estimated that the nation's GDP will expand at a rate of 5.3% in the current quarter. The Federal Reserve recently upped its forecast of economic growth to 6.5% for the year, which would be the fastest rate of expansion in 35 years.
"We are looking at another quarter of strong growth. This will allow for large wage gains without inflation," Dean Baker, senior economist at the Center for Economic and Policy Research, said in a post.
Still, he noted, the economy has a long way to go. "It would take more than 11 months of job growth like March to make up this loss," he wrote.
The Associated Press contributed reporting.