Restaurants Fuel Blowout Jobs Report, Stocks Surge

Stocks shot up and investor sentiment inched higher on Monday, the first day of trading since the Good Friday blowout jobs report showed the U.S. economy adding 916,000 jobs in March with 280,000 of those coming from the leisure and hospitality industry. 

From the Bureau of Labor Statistics: 

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.

Business Insider was bullish on the sector’s performance, crediting pent-up demand for dining out with bolstering the economy in an article titled: “Avocado toast will save the economy.”

The strong jobs numbers fit with a January survey from Deliveroo’s latest HospoVitality Index Report which indicated that 81% of restaurant owners surveyed had plans to hire more staff. 

In fact, restaurants may now be struggling to hire workers fast enough as the federal government’s expanded Unemployment Insurance benefits continue and COVID-19 restrictions on dining capacity lift. 

However, federal cash has certainly found its way into the restaurant industry’s coffers. Stimulus payments have consistently resulted in a bump in QSR sales and small businesses in the sector will soon be able to claim $28.6 billion in grants from the Restaurants Revitalization Fund.

Restaurant stocks that saw a major lift on Monday included Chipotle and McDonald’s.