The U.S. economy brought back more jobs than expected in March, presaging even faster employment growth in the coming months as more Americans become vaccinated and jobs across industries return.
The Department of Labor released its March report Friday at 8: 30 a.m. Here are the main metrics in the report compared to consensus estimates compiled by Bloomberg: None Change in non-farm payrolls: 916,000 versus 660,000 expected in February and a revised 468,000 in February None Unemployment rate: 6.0% vs. 6.0% projected and 6.2% in February All Average hourly earnings, month-over-month: revised 0.1% vs. 0.1% expected and a revised 0.3% in February. Average hourly earnings, year-over-year: 4.2% vs. 4.5% revised and a expected 5.2% in February Last month, payrolls grew with 916,000 at the highest in August since September.
Payrolls for both January and February were also revised higher: January's payroll change was upwardly revised from the 166,000 previously reported, and February's job growth totaled 468,000, up from the 379,000 previously reported.
It was n't only the March job numbers that impressed, as January and February saw large revisions higher as well, said Ryan Detrick, chief market strategist for LPL Financial in an email on Friday morning.
This is about as clear as it gets, the reopening is faster than nearly anyone expected.
The increase in the work sector again was the biggest contributor to the increase of monthly payrolls.
In March, some of the most badly beaten areas of the service economy made strides in recovering lost jobs, reflecting expanded capacity limits at bars, restaurants and other establishments. In March, the Leisure and Hotel payrolls increased to 280,000 after an upwardly revised gain of 384,000 in February.
However, these industries remain more than 3 million payrolls short of their pre-pandemic levels, representing the hardest-hit industry category tracked by the Bureau of Labor Statistics. Still, some other areas also contributed notably to the payroll gain of March.
Within the private sector, education and health services positions rose to almost double their February increase, and transportation and warehousing jobs rose by almost 50,000. Retail trade jobs rose by 22,500 for a third consecutive monthly gain, and professional and business service jobs posted a third straight month increase with payrolls up by 66,000. The private goods-producing sector also lost jobs on net in March after shedding payrolls in February as inclement weather impacted hiring. Construction jobs fell by 110,000 after 56,000 a month earlier.
The gain of 53,000 manufacturing payrolls in March almost tripled these industries' January's employment gains. And in the government, the public jobs jumped in March by 136,000, reflecting the continued resumption of in-person learning and other school related activities in many parts of the country, the BLS said in its report on Friday. The United States economy remained as of March about 8.4 million jobs short of its February 2020 level in the United States.
Average hourly earnings growth unexpectedly turned negative over last month in March and decelelerated over last year, partly reflecting the return of lower-wage workers back into the labor force. The unemployment rate fell to a pandemic low of 6.0% and was down from February by 0.2 percentage points. However, this unemployment rate remained well above the 50-year low of 3.5%, underscoring the distance left for the economy to make up.
In their latest projections, members of the Federal Open Market Committee suggested that the U.S. labor market would return to a 3.5% unemployment rate by the end of 2023.
According to Friday's report, the estimates for March payroll growth spanned a wide range.
Prognosticators have had to quantify the extent of the rebound after February's harsh weather and forecast the pick up in hiring due to easing social restrictions, increasing vaccinations and renewed assistance from the US Government's latest stimulus package. The vast majority of economists expected that rehiring accelerated last month.
High frequency data including the recent new weekly claims for unemployed have reflected a clear downward trend in the number of those recently unemployed. And earlier this week the March private payrolls report showed the most jobs added since September, and the Institute for Supply Management's manufacturing index pointed to rising employment trends in the goods-producing sector.
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: emily mcck None the weakness of labor market could last 'for several years' in the aftermath of the pandemic: economist Credit Suisse boosted S& P 500 target to 4,200 with more stimulus expected in 2021.
What has happened in the economy in 2020? All these jobs could disappear in the face of automation.