The U.S. job market boomed in March with 916,000 nonfarm payroll jobs added, far above economists' forecasts and signaling a strong pace of hiring a year after the COVID-19 pandemic hit, according to the Bureau of Labor Statistics.

The figure was significantly higher than the consensus estimate of economists polled by Econoday, which predicted an addition of 658,000 jobs. The jobless rate fell to 6% in March, in line with consensus estimates and down from 6.2% in February.

The monthly jobs gain was the highest the U.S. has seen since August 2020, and it was nearly double the revised increase of 468,000 jobs in February.

"With the recent deployment of more fiscal support, easing restrictions and rising optimism, we expect the jobs recovery to gain further momentum in the coming months," Wells Fargo senior economist Sarah House wrote in a research note.

Nearly all industries added jobs in March, with retailers adding 23,000 jobs and the leisure and hospitality sector growing by 280,000 jobs as pandemic restrictions eased. The resumption of in-person learning helped boost public and private education jobs by 190,000.

The construction sector also tacked on 110,000 jobs, rebounding after job losses of 56,000 in February that were likely weather-related. Manufacturing employment grew by 53,000, and transportation and warehousing jobs rose by 48,000.

The report, however, also noted roughly 9.7 million people are unemployed and that the 6% jobless rate is still significantly above its pre-pandemic level of 3.5%.

"Even if you [add] 1 million jobs a month, we still are going to have a lot of unemployed people by Labor Day," said William Spriggs, a Howard University professor and chief economist of the AFL-CIO.

A lack of hiring over the past year has pushed more people into the ranks of the long-term unemployed, Spriggs noted. Those who have been without a job for 27 weeks or more accounted for 43.4% of the total unemployed population in March, up from 41.5% in February and 39.5% in January.

Although the job market remains far from its pre-pandemic levels, the U.S. should make more progress in the coming months "as the health situation becomes less of a threat and vaccine roll out allows for a return to a post-pandemic normal," according to Rubeela Farooqi, chief U.S. economist at High Frequency Economics.

"Even so, beyond easy gains in the near term, the [Federal Reserve] will be focused on a complete recovery in the labor market, which will likely take some time," Farooqi wrote in a note to clients.

The Fed has signaled it plans on keeping its benchmark interest rate at effectively 0% until it sees a "broad-based and inclusive" recovery and inflation on track to moderately surpass its 2% goal.

Some communities are seeing significantly higher rates of joblessness, with the Black unemployment rate dipping to 9.6% and the Hispanic unemployment rate coming in at 7.9%.

A broader measure of unemployment, which captures persons marginally attached to the labor force and persons working part time for economic reasons, fell to 10.7% in March from 11.1% in February.

The labor force participation rate ticked up slightly to 61.5% in March but remains below its 63.3% level before the pandemic hit.