The number of new hires by U.S. employers exceeded expectations in March, fueled by factors such as vaccinations and more government epidemic relief payments, fueling expectations that an economic takeoff is already happening.
The U.S. Labor Department said Friday (April 2) that nonfarm payrolls rose by 916,000 jobs last month. The February figure was also revised upward, showing 468,000 new jobs instead of the 379,000 previously reported.
Economists polled by Reuters had predicted an increase of 647,000 jobs in March. the unemployment rate fell to 6.0 percent in March from 6.2 percent in February. The actual unemployment rate was higher than the reported figure because some people incorrectly classified themselves as “employed but absent.
The much-anticipated jobs report marked a painful anniversary for the labor market, with the March 2020 jobs report first reflecting the impact of forced closures of non-essential industries such as restaurants, bars and gyms for epidemic preparedness. At the time, the new coronavirus outbreak had just emerged.
That month, nearly 17 million people lost their jobs, followed by another 20.7 million in April of last year. More than 22 million jobs were lost during the pandemic, and economists estimate that it may take at least two years to recoup that loss.
As of Tuesday morning, the United States had administered 147.6 million doses of the new crown vaccine and distributed 189.5 million doses, according to the Centers for Disease Control and Prevention. The White House’s $1.9 billion epidemic relief package was passed in March and is now providing an additional $14 million to eligible families and new funding to companies.
Economists expect to add an average of at least 700,000 jobs per month in the second and third quarters of this year. This growth, combined with fiscal stimulus and the roughly $19 trillion in additional household savings accumulated during the epidemic, is expected to unleash a long-held wave of spending.
Gross domestic product in the first quarter is estimated to be as high as 10 percent on an annualized basis. The economy grew at a 4.3% rate in the fourth quarter of last year. This year’s growth rate is likely to exceed 7 percent, which would be the fastest since 1984. The U.S. economy shrank by 3.5 percent in 2020, the worst in 74 years.
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