American employers unexpectedly cut 92,000 jobs in February, marking a significant downturn in the labor market and pushing the unemployment rate up to 4.4%, according to data released by the Labor Department on Friday.
Key Takeaways
American employers unexpectedly cut 92,000 jobs in February, pushing the unemployment rate up to 4.4%. The job losses were widespread across various sectors and mark a significant downturn from January's gain of 126,000 jobs.
- U.S. employers cut 92,000 jobs in February, exceeding economists' expectations of a 60,000-job gain
- Unemployment rate rises to 4.4%, up from previous months
- Job losses were widespread across construction, healthcare, manufacturing, and service sectors
- Financial firms added 10,000 jobs despite ongoing cuts in the sector
- The outlook for the job market remains clouded by economic uncertainty and geopolitical tensions
The job cuts represent a sharp decline from January's gain of 126,000 jobs and fall short of economists' expectations of 60,000 new jobs for the month. Revisions also cut 69,000 jobs from December and January payrolls.
The weak employment picture adds to economic uncertainty exacerbated by geopolitical tensions with Iran, which has caused oil prices to surge and imposed unforeseen costs on businesses and consumers alike. The job market had been expected to rebound this year from a lackluster 2025 when the economy generated just 15,000 jobs a month.
'The labor market is struggling in the face of so many headwinds,' said Heather Long, chief economist at Navy Federal Credit Union. 'Companies are going to be even more reluctant to hire this spring until they can see consumers still spending. It's a tense time for the U.S. economy.'
The job losses were widespread across various sectors. Construction companies cut 11,000 jobs, likely due to frigid weather conditions. Healthcare firms shed 28,000 jobs following a four-week strike by more than 30,000 nurses and other front-line workers at Kaiser Permanente in California and Hawaii.
Manufacturing also took a hit with factories cutting 12,000 jobs, marking the 14th month of job losses out of the last 15. Restaurants and bars lost nearly 30,000 jobs, while administrative and support services firms cut nearly 19,000 jobs. Courier and messenger services saw a reduction of almost 17,000 jobs.
Despite the overall downturn, financial firms added 10,000 jobs, although job cuts continue to affect that sector as well this year. Average hourly wages rose by 0.4% from January and 3.8% from a year earlier.
The outlook for the job market remains clouded by economic uncertainty and geopolitical tensions, which have created a challenging scenario for the Federal Reserve as it decides whether to cut interest rates to support the job market or maintain higher rates to control inflation.
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