The US economy unexpectedly lost 92,000 jobs in February, with the unemployment rate ticking up to 4.4%, marking the sixth contraction of the labor market under the Trump administration. The February jobs report, released by the US Labor Department on Friday, defied economists' forecasts of marginal gains between 50,000 and 59,000 jobs.
The unemployment rate rose slightly by 0.1% from 4.3% in January, with over 25% of unemployed workers remaining jobless for more than 27 weeks. This decline follows downwardly revised gains in January, when the economy added 126,000 jobs. The healthcare sector was hit hardest, losing 28,000 jobs in February, while cuts to the federal government continued with 10,000 fewer jobs, partly due to strikes in California, Hawaii, and New York.
These losses in healthcare occurred despite the ADP private payroll report released on Thursday, which showed education and health services adding 58,000 jobs. Tariff-exposed sectors remained under pressure, with transportation and warehousing losing 11,000 jobs for the month and 157,000 jobs since last year. Industries such as construction, wholesale trade, retail, and leisure and hospitality saw no change from the previous month.
Although the US Supreme Court struck down import duties earlier in February, Trump imposed a 10% global tariff and has said it will soon rise to 15%. The Federal Reserve holds its next policy meeting on March 17-18, with economists expecting it to keep the benchmark interest rate in the 3.50%–3.75% range. However, the odds of a June rate cut have increased following Friday's data.
The dollar was little changed against a basket of currencies, while US Treasury yields fell. Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management, told Reuters, "Today’s numbers may have put the Fed between a rock and a hard place. Significant weakening in the labour market would support a rate cut, but given the risk that higher-for-longer oil prices could trigger another inflation surge, the Fed may feel compelled to remain on the sidelines." The White House did not respond to Al Jazeera’s request for comment.
US markets took a hit amid the stalling labor market, with the Nasdaq down 0.8%, the S&P 500 down 1%, and the Dow Jones Industrial Average down 1.1% in midday trading. This downturn reflects growing concerns over economic stability and policy effectiveness under the current regime.
Source: www.aljazeera.com