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February 2021 Jobs Report: U.S. Economy Added 379,000 Jobs

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The labor market picked up strength last month with unexpectedly large gains in one of the industries hardest hit by the yearlong pandemic: the nation’s restaurants and bars.

The new round of hiring, as vaccination efforts ramped up and restrictions on businesses eased, raised hopes that the economic recovery was taking hold more firmly.

All told, employers added 379,000 jobs, the government reported Friday, the strongest showing since October. The increase followed a deep loss in December and a modest rise in January.

But the February pace was still far short of the gains recorded from late spring to early fall as the pandemic’s sudden stranglehold loosened. There are roughly 9.5 million fewer jobs than a year ago, and a year’s worth of lost opportunities — as many as two million jobs that would most likely have been created if previous hiring trends had continued. Congress is considering a $1.9 trillion package of pandemic relief intended to carry struggling households and businesses through the coming months.

“What we’re seeing is broad, slow gains,” said Julia Pollak, an economist at the online job site ZipRecruiter. “It’s consistent with a slow reawakening of the labor market after a winter hibernation.”

Most of February’s increases came in the leisure and hospitality industries, which together employ 3.5 million fewer people than last year. The gains included 286,000 jobs in food services and drinking establishments, along with 69,000 at businesses like hotels and gyms.

Retail and manufacturing payrolls also showed some growth. Losses in employment by state and local governments — mostly in education — pared the overall increase, however. Harsh and unusually cold weather in February further held down gains.

The unemployment rate last month was 6.2 percent, down from 6.3 percent in January. But as the Federal Reserve and top administration officials have emphasized, that number understates the breadth of the damage.

More than four million people have quit the labor force in the last year, including those sidelined because of child care and other family responsibilities or health concerns. They are not included in the official jobless count. With them, the jobless rate is close to 10 percent.

“Even though we saw job gains pick up, it’s clear that many Americans don’t feel comfortable returning to work,” Ms. Pollak said. To her, the report’s most striking feature was the small number of workers — just 50,000 — who rejoined the work force last month.

The impact has been uneven. The jobless rate among Black workers climbed to 9.9 percent last month from 9.2 percent in January. In contrast, joblessness for white workers ticked down to 5.6 percent from 5.7 percent in January, and rates for workers who identify as Hispanic or Asian also fell.

The share of Black women who have left the labor force is also more than twice as high as the share of white men.

“We’re still in a pandemic economy,” said Julia Coronado, founder of MacroPolicy Perspectives and a former Fed economist. “Millions of people are looking for work and willing to work, but they are constrained from working.”

As Ron Klain, the White House chief of staff, pointed out on Twitter, it would take more than two years at February’s pace of hiring to get back to prepandemic employment levels.

Most economists, though, have offered increasingly optimistic forecasts for growth later in the year.

And recruiting sites have had an increase in job postings in recent weeks. Tom Gimbel, chief executive of LaSalle Network, a Chicago staffing firm, said the employers he spoke to were “absolutely ready to hire.”

Will Lopes, the chief executive of Catapult, which develops business technology for professional and university sports teams, said, “There’s a bit more optimism in the industry than there was before.”

Of the company’s 340 staff members, about 130 work in the United States. Mr. Lopes said he was ready to add 20 people — mostly ones highly skilled in technology — to Catapult’s American team.

Avant, an online lender that has its headquarters in Chicago and a call center in Oak Ridge, Tenn., is planning to step up hiring at both locations. The corporate staff, which numbers 257, is expected to grow about 30 percent over the next year, said Margaret Hermes, head of talent, while the Tennessee operation, which employs 169, is looking to hire more than 30 people.

As encouraging as the job gains are, millions of workers still rely on jobless benefits and other government assistance. First-time jobless claims rose last week. The ranks of the long-term unemployed — those out of work for six months or more — grew again last month, to 4.1 million.

Moreover, many people who are working part time would prefer full-time jobs.

Jamie Pontia, 44, was a bar manager at a major hotel chain in the Oakland area of Pittsburgh when the pandemic shut down operations last spring. Recently, a friend offered her a few hours of work a week at a nearby club.

At the hotel, she had worked five or six days a week, earning as much as $300 a day in wages and tips in addition to full benefits and a basketful of discounts. Now, she is averaging 12 hours a week, earning $8 an hour plus free fish sandwiches.

“I got behind on my car payment because that one was just too big,” Ms. Pontia said. “I looked out the window every night worrying, ‘Are they going to come get the car?’”

She was still eligible for unemployment insurance, but in December an unexplained glitch left her with no benefits for two months. Using an auto-redialer, she tried to call Pennsylvania’s unemployment office 2,000 times to fix the problem, she said, but was never able to get through.

She mentioned her frustration to someone she met at work. “He called his friend, who called his stepdaughter, who called her boyfriend, who called his son, who works for the unemployment office,” she said, and he was finally able to clear up the mistake.

Ultimately, Ms. Pontia hopes to get her old position back. But “to get a job even close to what I was able to have before seems absolutely impossible until things are safer,” she said.

Even as more and more of the population is vaccinated, the shape of the post-pandemic economy remains uncertain.

Online retail and other e-commerce related sectors saw explosive growth over the past year as the face-to-face economy went into a deep freeze.

Will people rush back out to restaurants, theaters, sports events and shopping malls or shift their behavior? Will workplaces crank back up to full capacity or shift to more remote work? Will business travel and conferences return to previous levels?

Postings for warehouse and stocking jobs were 38 percent above February last year, said Nick Bunker, head of research for the job site Indeed, but the question is whether that will continue.

“We’ve shifted consumption,” he said, “but how much of that snaps back once the pandemic is under control?”

Jeanna Smialek contributed reporting.

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