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Fuel Prices Send Airfares Higher, but Travelers Seem Ready to Pay

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Supplies are not keeping up with demand, and costs may go higher, experts say.A stunning rise in the cost of jet fuel has sent airfares soaring, and industry experts say they are likely to go higher. For now, though, travel-starved consumers seem more than willing to pay up.Jet fuel prices have settled somewhat since Russia’s invasion of Ukraine sent them skyrocketing last month, but the market remains extremely volatile. The problem is particularly severe in New York, where the cost of the fuel rose about fourfold to just over $7.50 a gallon before dipping back to $5.30 in recent days.Supply is broadly constrained and prices have spiked across the country. The Energy Department this week said that the inventory level for East Coast jet fuel stood at 6.5 million barrels, the lowest since the agency began keeping track in 1990.“Jet fuel has made the most parabolic move I’ve ever seen for any transportation fuel,” said Tom Kloza, global head of energy analysis at Oil Price Information Service. “It’s just insane.”The surge in prices has implications not only for airfares but also for the already high costs of global shipping. On Wednesday, for example, Amazon announced plans to impose its first “fuel and inflation surcharge” for sellers whose goods it stores and delivers.Airlines have been able to pass on some of their added fuel expense to consumers, many of whom are more than eager to travel after being denied the opportunity for two years.At the start of this year, the average cost of a round-trip domestic flight was $235, according to Hopper, an airfare-tracking app. Since then, ticket prices have risen 40 percent, to $330. Adit Damodaran, an economist at Hopper, which tracks prices for flights and hotels, said the company expects another 10 percent rise, to $360, by the end of May, before prices drop again in the summer.“Not only are the current prices that travelers are paying extremely high compared to historic price data, but the rate of increase has also been particularly steep since January,” he said.In addition to the rising cost of jet fuel, Mr. Damodaran said, the surge in airfares can also be attributed to typical seasonal patterns and the fact that demand was suppressed at the start of the year as the Omicron coronavirus variant spread.Some airlines have also cut flights in response to persistent staff shortages, creating greater competition and driving up fares for the flights that remain.Carriers typically pass on to consumers as much as 60 percent of a volatile rise in the price of fuel, experts said, a process that usually takes months. This time, however, the industry has been able to pass along costs more quickly, in large part because of high demand and a shift in consumer behavior during the pandemic toward buying tickets closer to the date of travel.“We are successfully recapturing a significant portion of the run-up in fuel,” Ed Bastian, the chief executive of Delta Air Lines, told investment analysts and reporters on a call on Wednesday. “This is occurring almost in real time, given the strong demand environment.”Mr. Bastian said that Delta, the first major carrier to report financial results for the first three months of this year, had seen a strong rebound so far and that it was preparing for a robust spring and summer.Delta paid an average price of $2.79 per gallon of jet fuel in the quarter, up 33 percent from the last quarter of last year. The price included a saving of 7 cents per gallon from the airline’s oil refinery outside Philadelphia. Delta said it expected the price of fuel to rise another 15 to 20 percent over the next three months, to between $3.20 and $3.35 per gallon, a range that includes an approximately 20-cent savings attributable to the refinery.Prices for jet fuel, like gasoline and diesel, generally go up and down with crude oil.In February, American Airlines reported that the price it paid per gallon of jet fuel had risen more than a third over the past year, from $1.48 in 2020 to $2.04 in 2021. At the time, it said that each sustained one-cent rise in the per-gallon price would increase its fuel expense for 2022 by about $40 million. This week, American estimated that it had paid $2.80 to $2.85 per gallon in the first quarter of the year.Rising fuel costs and fares seem to be doing little to dissuade consumers. Mr. Bastian said Wednesday that March was Delta’s best sales month ever, beating a record set in 2019, despite having 10 percent fewer seats available. That comes as fares for domestic flights were up about 20 percent across the board between March 2019 and March 2022, according to an analysis by the Adobe Digital Economy Index, which draws on online sales from six of the top 10 U.S. airlines.Refueling at San Francisco International Airport. Some jet fuel shipments were diverted from the East Coast to the West as California prices began to climb.Justin Sullivan/Getty Images“We’ve all been stuck at home for two years, and I think now that we have the opportunity to get out, there’s going to be a lot of willingness to pay,” said Joe Rohlena, lead airline analyst for Fitch Ratings. “If it remains expensive to travel further out, then you may see that kind of willingness to pay higher ticket prices back off.”The Russia-Ukraine War and the Global EconomyCard 1 of 6Rising concerns. More

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    Thanksgiving Holiday Travel Will Test Airlines

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    Widespread flight cancellations. Excruciating waits for customer service. Unruly passengers.And that was all before the holiday travel season.Even in normal times, the days around Thanksgiving are a delicate period for the airlines. But this week is the industry’s biggest test since the pandemic began, as millions more Americans — emboldened by vaccinations and reluctant to spend another holiday alone — are expected to take to the skies than during last year’s holidays.A lot is riding on the carriers’ ability to pull it off smoothly.“For many people, this will be the first time they’ve gotten together with family, maybe in a year, year and a half, maybe longer, so it’s very significant,” said Kathleen Bangs, a former commercial pilot who is a spokeswoman for FlightAware, an aviation data provider. “If it goes poorly, that’s when people might rethink travel plans for Christmas. And that’s what the airlines don’t want.”The Transportation Security Administration said it expected to screen about 20 million passengers at airports in the 10 days that began Friday, a figure approaching prepandemic levels. Two million passed through checkpoints on Saturday alone, about twice as many as on the Saturday before last Thanksgiving.Delta Air Lines and United Airlines both said they expected to fly only about 12 percent fewer passengers than they did in 2019. And United said it expected the Sunday after Thanksgiving to be its busiest day since the pandemic began 20 months ago. Many Thanksgiving travelers seem to be going about their travel routines as usual, with some now-familiar pandemic twists.“Airports are busy right now, and everything seems back to normal,” said Naveen Gunendran, 22, a University of Illinois student who was flying on United from Chicago to San Francisco on Saturday to visit relatives. “But we’re all packed together, and we just have to hope everybody is being safe.”The pent-up travel demand has elevated the cost of tickets. Hopper, an app that predicts flight prices, said that the average domestic flight during Thanksgiving week was on track to be about $293 round-trip this year, $48 more than last year — although $42 cheaper than in 2019.While the industry is projecting optimism about easy traveling, the influx of passengers has injected an element of uncertainty into a fragile system still reeling from the pandemic’s devastation. Some airlines have experienced recent troubles that rippled for days — stymying travel plans for thousands of passengers — as the carriers struggled to get pilots and flight attendants in place for delayed and rescheduled flights, a task complicated by thin staffing.“We’ve said numerous times: The pandemic is unprecedented and extremely complex — it was messy going into it, and it’s messy as we fight to emerge from it,” the president and chief operating officer of Southwest Airlines, Mike Van de Ven, said in a lengthy note to customers last month.His apology came after Southwest canceled nearly 2,500 flights over a four-day stretch — nearly 18 percent of its scheduled flights, according to FlightAware — as a brief bout of bad weather and an equally short-lived air traffic control staffing shortage snowballed.Weeks later, American Airlines suffered a similar collapse, canceling more than 2,300 flights in four days — nearly 23 percent of its schedule — after heavy winds slowed operations at Dallas-Fort Worth International Airport, its largest hub.American and Southwest have said they are working to address the problems, offering bonuses to encourage employees to work throughout the holiday period, stepping up hiring and pruning ambitious flight plans.Sara Nelson, president of the Association of Flight Attendants, a union representing roughly 50,000 flight attendants at 17 airlines, gave the carriers good marks for their preparations.“First and foremost, we are getting demand back after the biggest crisis aviation has ever faced,” she said.“I think there has been a lot of good planning,” she added. “And barring a major weather event, I think that the airlines are going to be able to handle the demand.”According to FlightAware, just 0.4 percent of flights were canceled on Sunday, which the T.S.A. said was nearly as busy as the Sunday before Thanksgiving in 2019.Thanksgiving travel will be a major test of whether the airline industry is ready to return to normal operations.DeSean McClinton-Holland for The New York TimesTravelers at La Guardia Airport in New York on Sunday. Some got away earlier than usual because of the flexibility of doing jobs or taking classes remotely.DeSean McClinton-Holland for The New York TimesMajor airlines have just started to report profits again, and only after factoring in billions of dollars of federal aid. While the aid allowed carriers to avoid sweeping layoffs during the pandemic, tens of thousands of employees took generous buyouts or early-retirement packages or volunteered to take extended leaves of absence.That has made ramping back up more difficult, and the pandemic has created new challenges. Flight crews have had to contend with overwork and disruptive and belligerent passengers, leaving them drained and afraid for their safety.Helene Albert, 54, a longtime flight attendant for American Airlines, said she took an 18-month leave by choice that was offered because of the pandemic. When she returned to work on Nov. 1 on domestic routes, she said, she saw a difference in passengers from when she began her leave.“People are hostile,” she said. “They don’t know how to wear masks and they act shocked when I tell them we don’t have alcohol on our flights anymore.”The number of such unruly passengers has fallen since the Federal Aviation Administration cracked down on the behavior earlier this year. But the agency has so far begun investigations into 991 episodes involving passenger misbehavior in 2021, more than in the last seven years combined. In some cases, the disruptions have forced flights to be delayed or even diverted — an additional strain on air traffic.Dallas-Fort Worth International Airport on Saturday.Cooper Neill for The New York TimesLayered on top of the industry’s struggles during the holiday season is the perennial threat of inclement weather. Forecasters have cautioned in recent days that gathering storm systems were threatening to deliver gusty winds and rain that could interfere with flights, but for the most part, the weather is not expected to cause major disruptions.“Overall, the news is pretty good in terms of the weather in general across the country cooperating with travel,” said Jon Porter, the chief meteorologist for AccuWeather. “We’re not dealing with any big storms across the country, and in many places the weather will be quite favorable for travel.”Even so, AAA, the travel services organization, recommended that airline passengers arrive two hours ahead of departure for domestic flights and three hours ahead for international destinations during the Thanksgiving travel wave.Some lawmakers warned that a Monday vaccination deadline for all federal employees could disrupt T.S.A. staffing at airports, resulting in long lines at security checkpoints, but the agency said those concerns were unfounded.The influx of passengers has added uncertainty to a system still reeling from the pandemic. Christopher Lee for The New York TimesMajor airlines have just started to report profits again, and only after factoring in billions of dollars of federal aid.Christopher Lee for The New York Times“The compliance rate is very high, and we do not anticipate any disruptions because of the vaccination requirements,” R. Carter Langston, a T.S.A. spokesman, said in a statement on Friday. With many people able to do their jobs or classes remotely, some travelers left town early, front-running what are typically the busiest travel days before the holiday.TripIt, a travel app that organizes itineraries, said 33 percent of holiday travelers booked Thanksgiving flights for last Friday and Saturday, according to its reservation data. (That number was slightly down from last year, when 35 percent of travelers left on the Friday and Saturday before Thanksgiving, and marginally higher than in 2019, when 30 percent of travelers did so, TripIt said.)Among those taking advantage of the flexibility was Emilia Lam, 18, a student at New York University who traveled home to Houston on Saturday. She is doing her classes this week remotely, she said, and planned her early getaway to get ahead of the crush. “The flights are going to be way more crowded,” she said, as Thursday approaches.Robert Chiarito and Maria Jimenez Moya contributed reporting. More

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    Delta’s Extra $200 Insurance Fee Shows Vaccine Dilemma for Employers

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    Charging unvaccinated workers more for health coverage may seem more appealing than a mandate but could be harder to carry out.For weeks, big employers like Citigroup, Google and the Walt Disney Company have been warming to the idea of requiring coronavirus vaccines for employees. Now that one vaccine has received full federal approval, President Biden wants more to follow suit.Delta Air Lines has chosen a very different tack — one that might seem to provide employees more choice but could be much harder to carry out. The company on Wednesday became the first large U.S. employer to embrace an idea that has been widely discussed but is mired in legal uncertainty: charging unvaccinated employees more for health insurance.Starting Nov. 1, Delta employees who have not received the vaccine will have to pay an additional $200 per month to remain on the company’s health plan. It is part of a series of requirements that unvaccinated workers will face in the months to come, the airline’s chief executive, Ed Bastian, said in a memo to staff.“We’ve always known that vaccinations are the most effective tool to keep our people safe and healthy in the face of this global health crisis,” he said. “That’s why we’re taking additional, robust actions to increase our vaccination rate.”Every Delta employee who has been hospitalized because of the coronavirus in recent weeks was not yet fully vaccinated, with hospital stays costing the company an average of about $50,000. Like most large employers, Delta insures its own work force, meaning it pays health costs directly and hires an insurance company to administer its plans.Corporate executives have wrestled with how to restore some normalcy to their operations, including by letting workers return to offices. They are trying to achieve several goals that can at times come into conflict: keeping employees safe, retaining staff opposed to vaccines at a time of tremendous turnover, and showing customers that they are taking the pandemic seriously while not alienating others put off by masks and other restrictions.Several companies, particularly those in health care, have made vaccination a condition of employment. Under a recent Biden administration policy, any nursing home that receives federal funds will be required to mandate vaccines for workers.Nearly 14 percent of U.S. employers now require, or plan to require, staff to be vaccinated in order to work at a company site, according to a survey this month from Mercer, a benefits consulting firm. In a May survey, just 3 percent of employers planned to require vaccinations.Insurance surcharges may appeal to companies that are seeking a less coercive means to increase vaccination rates, said Wade Symons, a partner at Mercer. He has had conversations with about 50 large companies that are considering imposing such fees, he added.“They still want to have the appearance of a choice,” Mr. Symons said.The businesses, he said, tend to be in industries that involve a lot of in-person work: manufacturing, hospitality, financial services, retail and transportation. Many have already tried incentives like cash bonuses or raffles for large prizes but still have vaccine holdouts.Delta said 75 percent of its staff and more than 80 percent of its pilots and flight attendants were vaccinated. But when CNN asked Mr. Bastian on Wednesday why the airline hadn’t simply mandated vaccines, he framed the issue as one of corporate culture.“Every company has to make its own decision for its culture, its people, what works according to its values,” he said. “I think these added voluntary steps, short of mandating a vaccine, are going to get us as close to 100 percent as we can.”Legally speaking, insurance surcharges are more complicated than simple employment mandates, which are widely considered legally sound. Federal law bars employers and insurers from charging higher prices to people with pre-existing health conditions. But the vaccine surcharges are being structured as employer “wellness” incentive programs, which are permitted under the Affordable Care Act. Such programs must be voluntary but can involve rewards or penalties as large as 30 percent of an employee’s health insurance premium.(Insurance plans bought on the marketplaces created by the Affordable Care Act and government programs like Medicaid and Medicare are forbidden to impose such surcharges.)Starting Nov. 1, unvaccinated Delta Air Lines employees will be charged more to stay on the company health plan.Stefani Reynolds for The New York TimesUnder federal law, employers must provide accommodations for workers who cannot receive a vaccine for health reasons or sincerely held religious beliefs. A recent lawsuit successfully challenged wellness programs with large financial penalties, arguing that the provision violated the Americans With Disabilities Act.“This is not rocket science, but it is not easy,” said Rob Duston, a lawyer with Saul Ewing Arnstein & Lehr in Washington, D.C., whose focus includes employment and disability issues.“You are dealing with the overlap of at least three different laws,” he added, referring to the Employee Retirement Income Security Act, the Affordable Care Act, and the Equal Employment Opportunity Commission’s wellness plan and Covid-19 guidelines. The companies will have to abide by the Americans With Disabilities Act and health privacy laws, too.Wellness programs have become widespread in large corporations even though studies show that they have very little impact on employee health. In some cases, they have tended to nudge workers who are facing penalties to drop their workplace coverage.“It seems like a more complicated way to do it,” said Karen Pollitz, a senior fellow at the Kaiser Family Foundation, who has studied such plans extensively and recently wrote a paper on vaccine mandate options. “In the middle of a pandemic, you want people to have health insurance. Why are you making it more likely they’re going to drop their health insurance?”But vaccination may prove different from other health behaviors that employers are seeking to change. Unlike weight loss or smoking cessation, vaccination does not require a long-term behavior change..css-1xzcza9{list-style-type:disc;padding-inline-start:1em;}.css-3btd0c{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-3btd0c{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-3btd0c strong{font-weight:600;}.css-3btd0c em{font-style:italic;}.css-w739ur{margin:0 auto 5px;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.625rem;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-size:1.6875rem;line-height:1.875rem;}}@media (min-width:740px){.css-w739ur{font-size:1.25rem;line-height:1.4375rem;}}.css-9s9ecg{margin-bottom:15px;}.css-16ed7iq{width:100%;display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-align-items:center;-webkit-box-align:center;-ms-flex-align:center;align-items:center;-webkit-box-pack:center;-webkit-justify-content:center;-ms-flex-pack:center;justify-content:center;padding:10px 0;background-color:white;}.css-pmm6ed{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-align-items:center;-webkit-box-align:center;-ms-flex-align:center;align-items:center;}.css-pmm6ed > :not(:first-child){margin-left:5px;}.css-5gimkt{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:0.8125rem;font-weight:700;-webkit-letter-spacing:0.03em;-moz-letter-spacing:0.03em;-ms-letter-spacing:0.03em;letter-spacing:0.03em;text-transform:uppercase;color:#333;}.css-5gimkt:after{content:’Collapse’;}.css-rdoyk0{-webkit-transition:all 0.5s ease;transition:all 0.5s ease;-webkit-transform:rotate(180deg);-ms-transform:rotate(180deg);transform:rotate(180deg);}.css-eb027h{max-height:5000px;-webkit-transition:max-height 0.5s ease;transition:max-height 0.5s ease;}.css-6mllg9{-webkit-transition:all 0.5s ease;transition:all 0.5s ease;position:relative;opacity:0;}.css-6mllg9:before{content:”;background-image:linear-gradient(180deg,transparent,#ffffff);background-image:-webkit-linear-gradient(270deg,rgba(255,255,255,0),#ffffff);height:80px;width:100%;position:absolute;bottom:0px;pointer-events:none;}.css-uf1ume{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-box-pack:justify;-webkit-justify-content:space-between;-ms-flex-pack:justify;justify-content:space-between;}.css-wxi1cx{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-flex-direction:column;-ms-flex-direction:column;flex-direction:column;-webkit-align-self:flex-end;-ms-flex-item-align:end;align-self:flex-end;}.css-12vbvwq{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;}@media (min-width:740px){.css-12vbvwq{padding:20px;width:100%;}}.css-12vbvwq:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-12vbvwq{border:none;padding:10px 0 0;border-top:2px solid #121212;}.css-12vbvwq[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-12vbvwq[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-12vbvwq[data-truncated] .css-5gimkt:after{content:’See more’;}.css-12vbvwq[data-truncated] .css-6mllg9{opacity:1;}.css-qjk116{margin:0 auto;overflow:hidden;}.css-qjk116 strong{font-weight:700;}.css-qjk116 em{font-style:italic;}.css-qjk116 a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;text-underline-offset:1px;-webkit-text-decoration-thickness:1px;text-decoration-thickness:1px;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:visited{color:#326891;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:hover{-webkit-text-decoration:none;text-decoration:none;}Jeff Levin-Scherz, a population health leader at the consulting firm Willis Towers Watson, said he had his doubts.“Premium surcharges might make intuitive sense, but based on their structure they are unlikely to lead to a large increase in vaccination rates,” Mr. Levin-Scherz said. “The surcharge approach has no impact on employees who waive coverage, and the penalties will be disproportionately imposed on lower-wage workers.”At Delta, the surcharge is one of several new requirements for unvaccinated workers. Starting immediately, those employees will have to wear masks indoors. In about two weeks, they will be subjected to weekly coronavirus tests. Then, on Sept. 30, unvaccinated employees will lose protections intended to cover pay for work missed while having to quarantine.The airline, which is based in Atlanta, its biggest hub, has a lot of employees in a state with a relatively low vaccination rate. Just over half of Georgia’s adult population is fully vaccinated, according to data from the Centers for Disease Control and Prevention.Delta’s decision not to require the vaccine may also help it to avoid criticism from Georgia’s conservative lawmakers, who have punished it in the past. In 2018, the state legislature voted to repeal a tax break on jet fuel after Delta ended a discount for members of the National Rifle Association, but the governor later ordered state officials to stop collecting the tax, effectively restoring the break. Lawmakers threatened to start collecting it again this year after Delta opposed new voting restrictions in the state.“It’s not an idle threat,” said Charles Bullock III, a professor of political science at the University of Georgia. “Doing this is probably more in keeping with where the Republican leadership would be,” he said of Delta’s approach on vaccination.American Airlines and Southwest Airlines, both based in Texas, have also not required vaccines. But United Airlines, which is based in Chicago, said this month that it would require vaccines, starting on Sept. 27.United’s chief executive, Scott Kirby, has lamented the dozens of letters he has had to write to families of employees who died from the virus. “We’re determined to do everything we can to try to keep another United family from receiving that letter,” he and Brett Hart, United’s president, told employees this month.One industry that has achieved high employee vaccination rates is Nevada’s casinos. State regulators allowed casinos to operate at full capacity once at least 80 percent of employees had received at least one shot of a coronavirus vaccination, a threshold some big properties achieved. Last week, MGM Resorts went further and said Covid vaccination would be a condition of employment for all salaried employees and new hires.“Vaccination is clearly the most effective tool in battling the pandemic, and it is one of our top priorities,” said Brian Ahern, a spokesman for MGM.Culinary Workers Union Local 226, which represents many casino workers, supports the mandate. “We would support stricter mandates, as the vaccine is the only way we can get through this pandemic,” Bethany Khan, director of communications and digital strategy for the union, said in an email.Peter Eavis More

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    Signs of Economic Hope Are Growing, Some With Superlatives

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    Soaring retail sales and a sharp drop in jobless claims are the latest reflection of a quickening recovery and suggest a year of remarkable growth.The American economic recovery is gathering steam, renewing confidence that a vibrant revival awaits as the pandemic recedes.After months of false starts, evidence is mounting that the economy has definitively turned a corner, with more growth on the horizon. Job gains last month were the strongest since August. There are signs that the snarled global supply chain may be untangling.And in dual reports on Thursday, the government reported more good news: Retail sales in March blew past expectations, rising nearly 10 percent, and jobless claims last week fell to their lowest level of the pandemic.Even as the country is still straining to contain the virus, as millions of people remain unemployed and as a large portion of the population remains unvaccinated, the data suggests that the long-heralded economic rebound is within reach.“I’m feeling quite optimistic,” said Gregory Daco, chief U.S. economist at Oxford Economics. “I think what we’re seeing is evidence of this booming economy that we’re going to be seeing over the coming months.”In the year since the coronavirus smothered the economy, economists have held out hope for a significant turnaround defined by plentiful job opportunities, higher wages and supercharged spending after months of pent-up demand. But the tantalizing promise at times appeared unlikely at best: After a period of growth over the summer, job gains largely stalled heading into the new year. New state unemployment claims spiked to over a million in one week in January. Retail sales, bolstered by stimulus payments, jumped in January only to slide the next month.Monthly Retail Sales

    Seasonally adjusted advance monthly sales for retail and food services.Source: Commerce DepartmentThe New York TimesYet recent weeks have delivered increasing reason for hope. With a fresh round of federal payments in their pockets and vaccines in their arms, many Americans have begun shopping and dining out with renewed alacrity, driving retail sales. A 9.8 percent increase last month was a strong comeback from the nearly 3 percent drop in February, when previous stimulus money had dissipated and a series of winter storms made travel difficult across much of the United States.The increase was broad-based, including big-ticket purchases like cars and discretionary spending on sporting goods, which economists interpreted as a sign of strong household income and growing optimism. Sales of clothing and accessories rose 18 percent, while restaurants and bars recorded a 13 percent increase — demonstrating how many areas of consumption are bouncing back.“I found it very encouraging that there are signs that people are waking up from hibernation, buying new clothes and going out to restaurants,” said Beth Ann Bovino, U.S. chief economist at S&P Global. “I think people are feeling optimistic that the United States will win the war on the virus. And they have good reason to be hopeful.”Many economists said the strong retail sales were likely to continue through the spring, even after the new stimulus payments are used up.The gradual return to normal activities as business restrictions ease has in turn prompted employers to recall workers — and this time, to hold on to them.The Labor Department reported on Thursday that the number of first-time claims for state unemployment benefits fell sharply last week, to about 613,000, the lowest level since the start of the pandemic. That was a decline of 153,000, the largest week-over-week decrease since the summer.In addition, 132,000 new claims were filed for Pandemic Unemployment Assistance, a federal program that covers freelancers, part-timers and others who do not routinely qualify for state benefits. That was a decline of 20,000 from the previous week.“We’re gaining momentum here, which is just unquestionable,” said Diane Swonk, chief economist at the accounting firm Grant Thornton.There are also broader signs of a comeback.After a devastating year, airlines are growing increasingly hopeful as travelers return. Over the past month, more than one million people were screened each day at federal airport checkpoints, according to the Transportation Security Administration, a signal that a sustained travel recovery is underway.As a result, American Airlines said this week that it expected to sell more than 90 percent as many tickets within the United States this summer as it did in the summer of 2019. Delta Air Lines said Thursday that it had recovered about 85 percent of its domestic leisure sales. If trends hold, the airline said, it could be profitable again by the summer.“A year after the onset of the pandemic, travelers are gaining confidence and beginning to reclaim their lives,” Ed Bastian, the company’s chief executive, said in announcing the airline’s first-quarter financial results. “Delta is accelerating into the recovery.”Moreover, the nation’s ports are handling record cargo volumes as consumers stock up. March was the busiest month on record for the Port of Oakland, while the Port of Los Angeles, the main point of entry for goods from Asia, said the first three months of the year were the busiest first quarter in its 114-year history.“As more Americans get vaccinated, businesses reopen and the economy strengthens, consumers continue to purchase goods at a dizzying pace,” Gene Seroka, the port’s executive director, said in a statement.For months, the port, like others around the world, has been overwhelmed by an influx of cargo, forcing container ships to wait days offshore to unload their goods. In many cases, the containers are unloaded and immediately sent back so they can be filled for another eastbound trip. While the backlog remains, Mr. Seroka said, it is expected to be eliminated in the coming months.The Port of Los Angeles, the main point of entry for goods from Asia, said the first three months of this year were the busiest first quarter in its 114-year history.Coley Brown for The New York TimesThe improving signs on so many fronts are being reflected in brightening forecasts for the months ahead. Morgan Stanley said Thursday that it expected the economy to grow 7.5 percent in 2021, after shrinking 3.5 percent in 2020. That would be the strongest growth rate for a calendar year since the 1950s.But if the economy appears to be on the upswing, the recovery is still fragile. Weekly applications for unemployment claims have remained stubbornly high for months, causing frustration even as businesses reopen and vaccination rates increase. They have also been a volatile economic indicator, temporarily dipping to their lowest level of the pandemic in mid-March before rising again in recent weeks.“You’re still not popping champagne corks,” Ms. Swonk said. “I will breathe again — and breathe easy again — once we get these numbers back down in the 200,000 range.”What’s more, concerns about workplace safety persist, especially for younger workers who have just become eligible for vaccinations. Many children are still attending schools remotely, complicating the full-time work prospects for their caregivers.Jobless claims for the next few months could remain significantly elevated as the labor market adjusts to a new normal.“The job market conditions for job seekers have really improved extremely quickly between January and now,” said Julia Pollak, a labor economist at the job site ZipRecruiter. “But there are still huge barriers to returning to work.”The rebound in March sales also shows how consumer spending — and the economic rebound as a whole — remains highly dependent on government support.President Biden’s $1.9 trillion American Rescue Plan, which was signed into law last month, provides $1,400-a-person payments to most households. The payments began arriving around March 17, and by the end of the month, economists saw signs that spending was ramping up again, such as increased hotel occupancy and travel through airports.Economists at Morgan Stanley had predicted that core retail sales would jump 6.5 percent in March, driven by the payments. The investment bank said only 30 percent of consumers tended to spend their payments within 10 days, suggesting that many have money on hand that could strengthen April sales as well.Other factors are contributing to the brightening recovery prospects. Mr. Biden moved up the deadline for states to make all adults eligible for vaccination to April 19, and every state has complied, laying the groundwork for more people to rejoin the work force. Students who have been learning remotely are increasingly returning to the classroom, a shift that will especially benefit women, who have been disproportionately sidelined during the pandemic by caregiving duties.Echoing the general perception that post-pandemic life is beckoning, American consumers are feeling increasingly upbeat. One measure of sentiment, tabulated by the Conference Board, showed that consumer confidence in March recorded its biggest one-month gain in nearly a decade, fueled by increased income and stronger business and employment expectations.“This was the deepest, swiftest recession ever,” said Ms. Pollak, the ZipRecruiter economist. “But it’s also turning into the fastest recovery.”Ben Casselman contributed reporting. More