US employers add a solid 151,000 jobs last month though unemployment up to 4.1%
By PAUL WISEMAN, Associated Press Economics Writer
WASHINGTON (AP) — U.S. employers added solid 151,000 jobs last month, but the outlook is cloudy as President Donald threatens a trade war, purges the federal workforce and promises to deport millions of immigrants.
The Labor Department reported Friday that hiring was up from a revised 125,000 in January. Economists had expected 160,000 new jobs last month.
The unemployment rate rose slightly to 4.1% as the number jobless Americans rose by 203,000.
Employment rose in healthcare, finance and transportation and warehousing. The federal government shed 10,000 jobs, the most since June 2022, though economists don’t expect Trump’s federal layoffs to have much of an impact until the March jobs report. Restaurants and bars cut nearly 28,000 jobs last month on top of a loss of almost 30,000 in January.
“The solid February jobs report shows that the economy remains healthy, but fears of what could come next are likely to overshadow the positive news from today’s release,” said Josh Jamner, investment analyst at ClearBridge Investments.
The job market has been remarkably resilient over the past year despite high interest rates.
Hiring continued, defying expectations that the United States would tip into a recession. The economy’s unexpectedly strong recovery from the pandemic recession of 2020 set loose an inflationary surge that peaked in June 2022 when prices came in 9.1% higher than they’d been a year earlier.
In response, the Federal Reserve raised its benchmark interest rate 11 times in 2022 and 2023, taking it to the highest level in more than two decades. The economy remained sturdy despite the higher borrowing costs, thanks to strong consumer spending, big productivity gains at businesses and an influx of immigrants who eased labor shortages.
Inflation came down – dropping to 2.4% in September — allowing the Fed to reverse course and cut rates three times in 2024. The rate-cutting was expected to continue this year, but progress on inflation has stalled since summer, and the Fed has held off.
Average hourly earnings rose 0.3% last month, down from a 0.4% increase in January.
Fed officials will likely see the figures as supporting their current wait-and-see approach toward interest-rate cuts. With inflation still modestly above the Fed’s 2% target, several have made clear in recent remarks that they would like to see more progress before cutting their benchmark rate any further.
Steady hiring and an expanding economy make it easier for the Fed to stay on the sidelines. Should companies start laying off workers and the unemployment rate rise, pressure could rise on the Fed to cut rates.
On Thursday, Fed governor Chris Waller suggested a cut was unlikely at the central bank’s March meeting, adding that Fed officials would like to see more data before making any further moves.
AP Economics Writer Christopher Rugaber contributed to this story.
Originally Published: March 7, 2025 at 5:52 AM PST