Fewer than expected Americans filed new claims for unemployment benefits last week as economic activity rebounds after weatherrelated disruptions in February, but it would likely take years for the labor market to fully recover from the pandemics scarring.

Initial claims for state unemployment benefits totaled a seasonally adjusted 684,000 for the week ended March 20, down from 781,000 in the prior week, the Labor Department said on Thursday. Economists polled by Reuters had forecast 730,000 applications in the latest week.

Claims shot up in the second week of March, likely as backlogs after severe winter storms in Texas and other parts of the densely populated South region were processed.

The deep freeze in the second half of February, which also gripped other parts of the country, depressed retail sales, homebuilding, production at factories, orders and shipments of manufactured goods last month.

Warmer weather, the White Houses 1.9 trillion COVID19 pandemic rescue package and increased vaccinations are expected to boost activity in March. Treasury Secretary Janet Yellen and Federal Reserve Chair Jerome Powell struck an optimistic note on the economy at an appearance before lawmakers this week.

It is going to be a very, very strong year in the most likely case, Powell said in response to a senators question on the economic outlook.

But the massive fiscal stimulus, which extended governmentfunded unemployment aid, including a 300 weekly supplement, through Sept….