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US employment falls unexpectedly in February
The U.S. economy lost 92,000 jobs last month, marking the largest decline since October's government shutdown and defying forecasts of stable hiring, according to Labor Department data released Friday.
Unemployment climbs as sectors shed jobs
The national unemployment rate rose to 4.4%, up from 4.2% in January. Nearly every industry reported losses, including healthcare-a traditionally resilient sector-where strikes disrupted hiring. Federal employment also continued its decline, shrinking by 10,000 positions in February and 330,000 (11%) since its October 2024 peak.
Revised data dims earlier optimism
December and January job gains were revised downward, further dampening hopes of a post-2025 rebound. Samuel Tombs, chief U.S. economist at Pantheon Macroeconomics, called the report a "blow to stabilization theories," writing in a note: "The idea the labor market has turned a corner implodes with this report."
Political fallout and market reaction
The downturn rattled Wall Street, with stocks sliding on the news. Democrats seized on the figures to criticize President Donald Trump's economic policies, while the White House dismissed concerns. Kevin Hassett, director of the National Economic Council, told CNBC he expects growth to drive job creation, stating: "There will be so much activity that everybody is going to be able to find a job that wants one."
Fed faces new dilemma
The report complicates the Federal Reserve's next move. Typically, a weakening labor market would prompt interest rate cuts to stimulate growth. However, analysts warn that rising oil prices-fueled by geopolitical tensions-could stoke inflation, leaving policymakers hesitant. Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management, described the Fed as "between a rock and a hard place."
Outlook remains uncertain
While healthcare hiring may rebound, economists caution that broader job growth could remain sluggish amid persistent economic headwinds.
