American employers added 151,000 solid jobs last month, but the prospects are cloudy while President Donald Trump threatens a trade war, cuts federal workforce and promises to deport millions of immigrants.
The Labor Department reported on Friday that hiring was up 125,000 revised in January. Economists expected 160,000 new jobs last month.
The unemployment rate increased slightly to 4.1%, the number of unemployment of Americans increased by 203,000.
Employment has increased in health care, finance, transport and storage. The federal government has lost 10,000 jobs since June 2022, although economists have not expected Trump's federal layoffs have a lot of impact before the job report in March. Restaurants and bars reduced nearly 28,000 jobs last month in addition to a loss of almost 30,000 in January.
“The labor market continues to resist, but we are still far from the place where we were a year or two years ago,” said Sarah House, principal economist at Wells Fargo.
House expects hiring to slow down and unemployment slips higher while Trump continues to reduce programs spending and reduce federal workforce, while imposing prices on American trade partners.
Expenditure reductions “are likely to spread in the private sector, to strike entrepreneurs and non -profit organizations, and we always have a business war that resumes,” said House. “There are several battles so that the labor market is fighting, several shocks that he must work in the coming months.”
The unexpected resumption of the economy of the pandemic recession of 2020 destroyed an inflationary increase which culminated in June 2022, when prices were 9.1% higher than they had been a year earlier.
In response, the Federal Reserve increased its reference interest rate 11 times in 2022 and 2023, bringing it to the highest level in more than two decades. The economy has remained robust despite higher borrowing costs, defying the expectations of a recession, thanks to strong consumption expenditure, large productivity gains in companies and an influx of immigrants who have softened the shortages of labor.
The American labor market has remained remarkably resilient, but it was cooled by the hiring heated by the red 2021-2023. Employers added a decent average of 168,000 jobs per month last year. But it was down 216,000 in 2023, 380,000 in 2022 and a record of 603,000 in 2021 while the economy bounced COVVI-19 locking.
Inflation has dropped – falling to 2.4% in September – allowing the Fed to overthrow the course and reduce rates three times in 2024. Rail reduction should continue this year, but inflation progress has been in a standstill since the summer, and the Fed has retained.
The average hourly profits increased by 0.3% last month, against an increase of 0.4% in January.
The Fed officials will probably consider figures as supporting their current waiting approach in terms of interest rate reductions. Inflation is still modestly higher than the target target of the Fed, several have clearly indicated in recent remarks that they would like to see more progress before reducing their reference rate more.
Regular hiring and an expansion economy allow the Fed to stay more easily on the sidelines. If companies are starting to dismiss workers and the unemployment rate increases, the pressure could increase on the Fed to reduce rates.
On Thursday, the governor of the Fed, Chris Waller, suggested that a cup was unlikely at the central bank's March meeting, adding that Fed officials would like to see more data before making other movements.
