Economic Rebound Gains Momentum as Unemployment Falls to Six Percent

April 2, 2021 – Employment rose by 916,000 in March as the U.S. unemployment rate dropped to six percent, according to the most recent U.S. Bureau of Labor Statistics report released this morning. That’s down from a peak of 14.7 percent last April, but still far above the 3.5 percent rate in February before the coronavirus pandemic led to mass economic shutdowns across the country. Job growth was widespread in March, led by gains in leisure and hospitality, public and private education, and construction. “America’s economic recovery is reaching a turning point as the hardest hit industries, like hospitality, are starting to reaccelerate hiring while the industries that have fared well throughout the pandemic, like manufacturing and technology, continue to demonstrate consistent demand for workers,” said Karen Fichuk, CEO, Randstad North America and Randstad N.V. executive board member. “At Randstad US, we are actively recruiting for more than 15,000 new full-time jobs for our largest clients. This quantity of open full-time roles is the largest we have seen in 24 months and represents a 38 percent increase over the fourth quarter of 2020.”

“The volume of jobs added in March is a clear signal that the U.S. economy is strengthening,” said Michael Smith, global CEO of Randstad Sourceright. “With states expanding vaccine eligibility and easing business restrictions, we are seeing a surge in hiring, especially in the leisure and hospitality industries. As organizations look to hire to keep pace with renewed economic growth, we are seeing increased interest in recruitment processing outsourcing, which provides a turn-key workforce, technology stack and talent analytics for companies to scale up and down as needed,” he says. “This is an encouraging sign of the confidence corporate America has in the economy and the outlook for hiring in 2021.”

Where Job Growth Occurred

• In March, employment in leisure and hospitality increased by 280,000, as pandemic-related restrictions eased in many parts of the country. Nearly two-thirds of the increase was in food services and drinking places (+176,000). Job gains also occurred in arts, entertainment, and recreation (+64,000) and in accommodation (+40,000). Employment in leisure and hospitality is down by 3.1 million, or 18.5 percent, since February 2020.
• In March, employment increased in both public and private education, reflecting the continued resumption of in-person learning and other school-related activities in many parts of the country. Employment rose by 76,000 in local government education, by 50,000 in state government education, and by 64,000 in private education. Employment is down from February 2020 in local government education (-594,000), state government education (-270,000), and private education (-310,000).
• Construction added 110,000 jobs in March, following job losses in the previous month (-56,000) that were likely weather-related. Employment growth in the industry was widespread in March, with gains of 65,000 in specialty trade contractors, 27,000 in heavy and civil engineering construction, and 18,000 in construction of buildings. Employment in construction is 182,000 below its February 2020 level.
• Employment in professional and business services rose by 66,000 over the month but is down by 685,000 since February 2020. In March, employment in administrative and support services continued to trend up (+37,000), although employment in its temporary help services component was essentially unchanged. Employment also continued on an upward trend in management and technical consulting services (+8,000) and in computer systems design and related services (+6,000).
• Manufacturing employment rose by 53,000 in March, with job gains occurring in both durable goods (+30,000) and nondurable goods (+23,000). Employment in manufacturing is down by 515,000 since February 2020.
• Transportation and warehousing added 48,000 jobs in March. Employment increased in couriers and messengers (+17,000), transit and ground passenger transportation (+13,000), support activities for transportation (+6,000), and air transportation (+6,000). Since February 2020, employment in couriers and messengers is up by 206,000 (or 23.3 percent), while employment is down by 112,000 (or 22.8 percent) in transit and ground passenger transportation and by 104,000 (or 20.1 percent) in air transportation.
• Employment in the other services industry increased by 42,000 over the month, reflecting job gains in personal and laundry services (+19,000) and in repair and maintenance (+18,000). Employment in other services is down by 396,000 since February 2020.
• Social assistance added 25,000 jobs in March, mostly in individual and family services (+20,000). Employment in social assistance is 306,000 lower than in February 2020.
• Employment in wholesale trade increased by 24,000 in March, with job gains in both durable goods (+14,000) and nondurable goods (+10,000). Employment in wholesale trade is 234,000 lower than in February 2020.
• Retail trade added 23,000 jobs in March. Job growth in clothing and clothing accessories stores (+16,000), motor vehicle and parts dealers (+13,000), and furniture and home furnishing stores (+6,000) was partially offset by losses in building material and garden supply stores (-9,000) and general merchandise stores (-7,000). Employment in retail trade is 381,000 below its February 2020 level.
• Employment in mining rose by 21,000 in March, largely in support activities for mining (+19,000). Mining employment is down by 130,000 since a peak in January 2019. Financial activities added 16,000 jobs in March. Job gains in insurance carriers and related activities (+11,000) and real estate (+10,000) more than offset losses in credit intermediation and related activities (-7,000).
• Financial activities has 87,000 fewer jobs than in February 2020.
• Employment in healthcare and information changed little in March.

Veteran Search Consultants Weigh In

“​We have seen continued search and hiring activity over the past few months, as well as mid-level and senior executives reaching out to plan the next steps in their careers as economic uncertainty fades,” said Drew Desky, principle consultant at Do-Right Consultants. “In the absence of a renewed virus variant shock, we expect the recovery to spread to harder-hit sectors. The sector we are most bearish on is commercial real estate given the lasting shift to a partial or total work-from-home strategy being constructed by both large and small businesses.”

“​We will know the recovery is complete when business travel and in-person entertainment returns to levels close to pre-pandemic levels,” Mr. Desky said. “Companies will need to focus on increasing top-line revenues, and this will require personal connections to be made and strengthened as competition for sales heats up. As a result, there will be a renewed demand for stellar sales talent. Organizations that pre-emptively hire this talent will be at a competitive advantage as we approach full recovery.”

“​The nuts and bolts of our business haven’t changed,” said Mr. Desky.  “We remain focused on identifying the needs and priorities of our clients and consulting with them to present optimized candidate and career opportunities to them. Obviously, this has been done exclusively through telephone and video over the past year, but we look forward to the productivity of in-person meetings when they return as well.”

“We have attended more than a dozen industry conferences annually for over 20 years as we know that there is a significant advantage for our clients by establishing and maintaining face-to-face relationships with these executives,” said Brian Cole, managing partner at MedTech Executive Search Inc. “The pandemic changed the way that we were able to communicate with the industry leaders.”

“Thus, we had to be proactive and apply other tools to communicate virtually with them,” Mr. Cole said. “Executives have adapted to using Zoom, Teams and other communication vehicles. There is no doubt that businesses will continue to utilize these tools and we will continue to use them as well.” But, he added, as business life normalizes, “we expect to leverage these tools along with actively attending conferences which will generate additional opportunities for us to have visual dialogue with industry leaders.”

Related: Major Paradigm Shifts Coming Out of the Coronavirus Crisis

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media