The U.S. added 228,000 jobs in March, far more than the 140,000 economists had expected. Unemployment ticked up slightly to 4.2% from 4.1% the month before.
Last month’s gains far outnumber the 117,000 roles added in February, according to data released Friday by the Bureau of Labor Statistics. Health care, transportation and warehousing were among the sectors that added roles in March. Federal hiring declined amid sweeping cuts to the government’s workforce, though many of those layoffs aren’t showing up yet in official figures due to leave and severance policies and routine lags in data gathering.
The March report shows a resilient U.S. economy, though it’s already a snapshot in time. After President Donald Trump’s sweeping tariffs announcement Wednesday slammed into global markets, analysts say the labor market is likely to enter more uncertain terrain.
“This report isn’t likely to be seen as more important than the trade war,” Kathy Jones, chief fixed income strategist at Charles Schwab, wrote on X Friday morning following the release.
Goldman Sachs analysts offered much the same take. “Today’s better than expected jobs report will help ease fears of an immediate softening in the US labor market. However, this number has become a side dish with the market just focusing on the entrée: tariffs,” they wrote Friday.
Stock futures continued to plummet before U.S. markets opened Friday morning, after notching their worst single trading day since the depths of the pandemic on Thursday.
There are growing signs of wobbling in a labor market that has held steady even as it cools, and analysts are already looking ahead to the next tranche of data.
“The would-be stillness of this report is not a good indication of what might be still to come,” Bankrate Senior Economic Analyst Mark Hamrick said in a statement about the Friday jobs report. “In the wake of the tariffs decision, there’s been an earthquake, and we await the arrival of the economic equivalent of the tsunami waves coming ashore.”
The slight rise in unemployment last month likely reflects people heading back into the workforce in search of jobs. The labor force participation rate ticked up slightly as well, to 62.5%. But the March numbers also showed average hourly wage growth slowed, and temporary layoffs eased while permanent job losses inched higher.
Private-sector hiring continued to chug along, according to figures released this week by payroll processor ADP. But they, too, showed a slowdown in pay growth, with the average raises earned by people changing jobs hitting a low not seen since September. And a separate BLS release this week found that while layoffs have remained subdued, so has hiring.
“Next month is when hard data is likely to start showing signs of what soft data has already been signalling,” Seema Shah, chief global strategist at Principal Asset Management, wrote in a note to clients Friday morning.
Data published Thursday by the jobs and career consultancy Challenger, Gray & Christmas singled out Elon Musk’s Department of Government Efficiency as responsible for over 216,000 announced reductions in the federal workforce in March.
“The market needed today’s number,” Shah wrote. “Everyone knows that economic weakness is coming, but at least we can be reassured that the labor market was robust coming into this policy-driven shock.”
