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US Job Growth Falters Amid Trade Policy Chaos, Unemployment Rate Hits 4.1%

HomeUS Job Growth Falters Amid Trade Policy Chaos, Unemployment Rate Hits 4.1%

US Job Growth Falters Amid Trade Policy Chaos, Unemployment Rate Hits 4.1%

US Job Growth Falters Amid Trade Policy Chaos, Unemployment Rate Hits 4.1%

US Job Market Experiences Slowdown Amid Rising Uncertainty

The US job market has shown signs of slowing down in recent months, with various indicators pointing to a more uncertain economic outlook. According to the latest data from the Bureau of Labor Statistics, employment growth slowed to 113,000 jobs added in February, below expectations.

Key Takeaways:

  • The unemployment rate rose to 4.1% from 4.0% in January, reflecting a decline in household employment and a decrease in labor force participation.
  • A broader measure of unemployment, which includes those who want to work but have given up searching and those working part-time due to lack of full-time employment, soared to 8.0%, the highest since October 2021.
  • Multiple job-holders rose to 8.860 million from 8.764 million in January, representing a significant share of the employed workforce.

Sector Performance:

  • Healthcare led job growth, adding 52,000 positions across ambulatory services and hospitals as well as nursing and residential care facilities.
  • Financial activities employment increased by 21,000, with transportation and warehousing payrolls rising 18,000.
  • However, federal government payrolls excluding the post office declined 6,700, a sign of ongoing efforts to shrink the government and reduce spending.

Fed Decision:

  • The Federal Reserve is expected to keep its benchmark overnight interest rate unchanged in the 4.25%-4.50% range this month as policymakers continue to monitor the economic impact of tariffs and an immigration crackdown.
  • Financial markets expect the US central bank to resume rate cuts in June, though much would depend on inflation.

Economic Outlook:

  • The economy faces rising uncertainty as it enters March, with a drop in consumer spending and homebuilding and surge in the trade deficit linked to tariffs stoking fears of stagflation.
  • The Atlanta Fed is forecasting GDP contracting at a 2.4% annualized rate this quarter.

Conclusion:

The US job market has experienced a slowdown in recent months, with various indicators pointing to rising uncertainty and economic challenges ahead. As policymakers continue to monitor the situation, it remains to be seen how the economy will respond to these developments.