US employers added the most jobs in seven months with improvement across most industries in March, as more vaccinations and fewer business restrictions supercharged the labor market recovery.
Nonfarm payrolls increased by 916,000 last month and February employment was revised up to a 468,000 gain, according to a Labor Department report Friday. The unemployment rate fell to 6%, as the workforce participation rate edged higher.
The median estimate in a Bloomberg survey of economists was for a 660,000 gain in payrolls in March. The unemployment rate was projected to fall to 6%.
Rising Covid-19 infections had severely restrained the labor market for months, but now more than two million Americans are getting vaccinated daily and economic activity is picking up. What's more, businesses have a clearer view of potential demand as a wave of stimulus-supported consumer spending is poised to wash over the nation's service providers.
While stronger sales and daily progress in the fight against the coronavirus will help bring the labor market closer to its pre-pandemic employment levels, a full recovery will take time.
U.S. Treasury yields received a bump higher following the report, with the 10-year rate climbing as high as 1.69%, although it remained within around 2 basis points of its prior day close. U.S. stocks are closed Friday for a holiday.
The payroll figures showed broad-based gains across industries, led by a 280,000 surge in leisure and hospitality. Construction payrolls jumped 110,000 after dipping in February amid severe winter weather. Education employment also climbed as more schools reopened.
The $1.9 trillion stimulus package signed last month by President Joe Biden should give an additional shot of adrenaline to hiring amid renewed support for businesses and individuals.
A report Thursday from the National Federation of Independent Business showed a record share of small-business owners in March said they had unfilled positions. That indicates employment will remain strong in coming months.
Further, Federal Reserve Chair Jerome Powell has pledged the central bank will continue to support the economy with accommodative monetary policy, despite the recent uptrend in economic and employment data.
"The recovery is far from complete," Powell said at the House Financial Services Committee hearing on March 23. "As we have emphasized throughout the pandemic, the path of the economy continues to depend on the course of the virus."
