The U.S. economy added far more new jobs than expected last month, data from the Labor Department indicated Friday, as hiring begins to return to its pre-pandemic pace amid accelerating vaccine rollouts and multiple state reopening announcements.
The Bureau for Labor Statistics said 916,000 new jobs were created last month, compared to a consensus market forecast of around 675,000, tipping the headline unemployment rate down to 6%. February's total was also revised to show 468,000 jobs created in the month, up 89,000 from the initial estimate.
"Just as important as the big jobs number are the types of jobs added. While leisure and hospitality, the hardest-hit sectors, gained the most, other gains show the economy is broadly under repair," said Robert Frick, corporate economist at Navy Federal Credit Union. "But while we'll likely see strong jobs reports for months, within the March report were clues of problems we'll face in the future."
"Labor participation and the number of long-term unemployed remained about the same, foreshadowing that moving millions of Americans back into the labor force will be an issue in the drive to return to pre-pandemic employment levels," Frick noted.
Weekly jobless claims unexpectedly rose to 719,000 for the period ended March 27, the Commerce Department said Thursday, although the four-week average slipped to 729,500, the lowest since the beginning of the pandemic in March of last year.
ADP's National Employment Report, which it compiles with Moody's Analytics, showed Wednesday that private sector jobs grew by 517,000 last month, just shy of Wall Street forecasts of a 525,000 total but the strongest monthly figure since September.
Hiring is expected to accelerate in the months ahead, however, as vaccine rollouts accelerate and states issue formal reopening orders as the pandemic wanes.
Centers for Disease Control data published Thursday indicated that just more than 56 million Americans have been fully vaccinated against the coronavirus, with another 99.5 million individuals receiving at least one dose of either the Pfizer (PFE) - Get Report, Moderna (MRNA) - Get Report or Johnson & Johnson (JNJ) - Get Report vaccine.
"March data tell us nothing about what will happen to payrolls when the reopening accelerates," said Ian Shepherdson of Pantheon Macroeconomics. "We expect to see a 1 million-plus increase in April, and gains of 2 million-plus in May and June."
U.S. equity futures, which are open for trading until 9:15 a.m. ET, jumped higher on the news, with contracts tied to the Dow Jones Industrial Average indicating a 200-point opening bell gain on Monday while those linked to the S&P 500 priced for a 21-point advance.
Benchmark 10-year U.S. Treasury bond yields, which will remain trading until 12 p.m., edged past 1.68% as average hourly earnings in the payroll data showed a 0.1% decline from the previous month.