The numbers: Restaurants and other businesses hired the most workers in March in seven months as the U.S. added 916,000 new jobs, signaling the economy is primed for a period of rapid expansion again.
Employment accelerated after the weather warmed and a decline in coronavirus cases allowed states to relax business restrictions. Rising vaccination rates gave Americans more freedom to venture out to eat, attend a game or engage in other activities they would have avoided at the height of the pandemic.
Massive federal stimulus, including $1,400 checks for most households, also gave people more money to spend.
The jobs explosion in March easily exceeded Wall Street forecasts. Economists polled by Dow Jones and The Wall Street Journal has forecast a 675,000 increase.
Hiring in February and January was also much stronger than previously reported.
Economists predict even faster hiring in the months ahead if most Americans get vaccinated and the coronavirus fades away, though it will take awhile to know for sure. Covid-19 cases have actually risen slightly in the past few weeks for the first time in several months.
The official unemployment rate, meanwhile, slipped to 6% from 6.2%, the Labor Department said Friday. Yet the official rate doesn’t capture some 4 million-plus people who lost their jobs last year and left the labor force.
Economists peg the true unemployment rate at above 9%.
Big picture: The skies have cleared for the economy after a record surge in coronavirus cases clouded the outlook over the winter. Growth is likely to speed up through the spring and early summer if the vaccines do their job and keep the coronavirus at bay.
Yet even in a best-case scenario, the U.S. is unlikely to recoup all of the 8 million-plus jobs that are still missing one year after the onset of the pandemic. The destruction caused by the pandemic, including lost jobs and shuttered businesses, is likely to linger for a few years.
Market reaction: The Dow Jones Industrial Average DJIA, +0.52% and S&P 500 SPX, +1.18% closed higher on Thursday to finish out a shortened week. Markets are closed on Friday due to the Good Friday holiday.