Private firms in the past month hired at the fastest pace since September, according to a survey released Wednesday, a welcome rebound after several tepid results in the pandemic recovery.
Data from payroll services firm ADP showed private employment jumped by 517,000 in March, slightly less than economists had expected but much better than the 176,000 gain in February.
The vast majority of the jobs were in the services sector, including a surge of 169,000 in leisure and hospitality, the sector hardest hit by the Covid-19 restrictions.
Goods-producing firms added 80,000 positions, also the best result since September and recovering the 11,000 lost in the prior month, the survey showed.
"Job growth in the service sector significantly outpaced its recent monthly average, led with notable increase by the leisure and hospitality industry," ADP chief economist Nela Richardson said.
"This sector has the most opportunity to improve as the economy continues to gradually reopen and the vaccine is made more widely available," Richardson said, noting "the groundwork is being laid for a further boost in the monthly pace of hiring in the months ahead."
The report is scrutinized as a preview of the all-important monthly employment data the Labor Department is due to release Friday.
Economists are expecting a sharp rebound in job gains of 627,000 for March, and a drop in the unemployment rate to 6.0 percent from the current 6.2 percent as more businesses reopen and accelerated vaccine distribution allows consumers to feel confident about their economic prospects.