US employers cool hiring in March as tariff fallout threatens economy: Poll

Washington – US employers probably tempered their hiring in March, just as consumers grew increasingly cautious and the economic outlook dimmed on concerns about the fallout from higher tariffs.

Payrolls rose by 138,000, below the 151,000 increase a month earlier, according to a median projection of economists surveyed by Bloomberg. This would leave average job growth over the past three months at the slowest pace since October 2024. The unemployment rate is seen holding at 4.1 per cent.

The latest report card on the labour market follows data that indicates a notable first-quarter slowing in the economy. Personal spending barely rose in February after a January slump, disposable income growth remained soft, and March consumer sentiment sank on fears of mounting inflationary pressures.

Shortly after jobs data on April 4, Federal Reserve chair Jerome Powell will discuss the economic outlook. Other Fed governors, including Dr Adriana Kugler, Dr Philip Jefferson, Dr Lisa Cook and Mr Michael Barr, are also due to speak in the coming week. 

Anxiety is building among households and businesses about US President Donald Trump’s aggressive trade posture. Mr Trump on April 2 is expected to unleash his biggest tariff salvo to date – a package of blanket increases in duties on foreign imports.

The US administration is seeking to reverse trade imbalances, spark investment in the US, and spur the domestic output of critical goods and materials.

Mr Trump told NBC News in an interview on March 30 that he “couldn’t care less” if automakers raise car prices in response to the planned tariffs on imported vehicles.

Bloomberg Economics analysts said: “Our baseline is that the actual tariffs will be substantially lower than the worst-case scenario, that many will be implemented only after investigations, and that some countries will receive exemptions. Still, after the dust settles, effective tariffs on US imports could be around 15 per cent next year, the highest in almost a century.

“Facing clear upside risks to inflation, the Fed looks set to hold rates steady. The real risk is that, if the labour market does turn, rate cuts will come too late.”

With consumer spending and confidence sliding, any notable weakening in job growth will raise additional concerns about the economy’s prospects. Economists are also parsing business survey data for signs that more companies are putting expansion plans on ice until there is greater clarity on policy.

On April 1, the Institute for Supply Management will issue its March manufacturing survey, followed two days later by its report on services activity. S&P Global will put out similar releases.

Meanwhile, still-elevated inflation and the risk of a tariff-related increase in goods prices explain why Fed policymakers are in no rush to resume lowering interest rates. BLOOMBERG

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