The U.S. job market is ready for takeoff — and this time, few economists expect it to come crashing back down to earth.
The Labor Department will release data on Friday detailing hiring and unemployment in March. Forecasters surveyed by FactSet expect the report to show that U.S. employers added more than 600,000 jobs last month, up from 379,000 in February and the most since October.
Even better numbers probably lie ahead. The March data was collected early in the month, before most states broadened vaccine access and before most Americans began receiving $1,400 checks from the federal government as part of the most recent relief package. Those forces should lead to even faster job growth in April, said Jay Bryson, chief economist for Wells Fargo.
“If you don’t get a barn burner in March, I think you’re probably going to get one in April,” he said.
The biggest risk to the economy is as it has been for the last year: the pandemic itself. Coronavirus cases are rising again in much of the country as states have begun easing restrictions. If that upward trend turns into a full-blown new wave of infections, it could force some states to backpedal, impeding the recovery, Mr. Bryson warned.
But few economists expect a repeat of the winter, when a jump in virus cases pushed the recovery into reverse. More than a quarter of U.S. adults have received at least one dose of a coronavirus vaccine, and more than two million people a day are being inoculated. That should allow economic activity to continue to rebound.
“This time is different, and that’s because of vaccines,” said Julia Pollak, a labor economist at the job site ZipRecruiter. “It’s real this time.”
Still, the labor market will need many months of strong growth to return to anything close to its prepandemic level. As of February, the United States had roughly 9.5 million fewer jobs than in February 2020, and the gap is even larger when accounting for a year’s worth of missed job growth.
Forecasters expect the March report to show that the unemployment rate fell to 6 percent, down from 6.2 percent in February and from a peak of nearly 15 percent in April. But economists caution against reading too much into the unemployment rate, which excludes millions of people who left the labor force during the pandemic, in many cases because they needed to care for children while schools were closed or because they did not feel safe going to work. If those people begin to look for jobs again as the pandemic ebbs — as economists hope they will — the official unemployment rate might be slow to recover.
“So many people have been pushed out by the pandemic and its fallout that the short-term trends are going to be really hard to parse out,” said Nick Bunker, research director for the hiring site Indeed.