Seoul Gazette - US hiring misses expectations in February as jobs market faces pressure

Friday's report paints a still-solid picture of the employment market in the first full month of Trump's second term, amid growing blowback over unprecedented cuts to the US government.

The world's biggest economy added 151,000 jobs last month, up from January's revised 125,000 figure, the Labor Department said.

This bounceback came after bad weather in January, while the unemployment rate edged up to 4.1 percent from 4.0 percent.

Analysts said the figures marked a decent showing, though they warned of uncertainty ahead linked to Trump's tariffs and noted that effects from the administration's cost-cutting have yet to show up entirely.

These efforts have been led by Trump's billionaire adviser Elon Musk and his Department of Government Efficiency (DOGE), which has slashed thousands of federal jobs and upended agencies -- prompting numerous lawsuits.

"Within government, federal government employment declined by 10,000 in February," said the Labor Department.

- 'Re-privatize' -

The White House was quick to emphasize that the auto industry in turn added 9,000 jobs. Press Secretary Karoline Leavitt said in a statement that "the private sector is leading the way" in employment gains.

The Trump administration has expressed plans to "re-privatize and re-industrialize the American economy," according to Treasury Secretary Scott Bessent. He added last month that this comes with wider efforts towards deregulation and fair trade.

Trump has launched a broad offensive aimed at cutting public spending and reducing the federal bureaucracy, one of the goals he promised on the campaign trail.

Yet the full hit from Trump's federal workforce cuts are unlikely to be reflected in the February report, given the payroll survey was likely conducted "too early in the month," said EY senior economist Lydia Boussour this week.

"We expect a more visible dent to federal payrolls in March and subsequent months," she added.

Pantheon Macroeconomics noted this week that the return of weather to seasonal norms likely boosted payroll growth by 15,000 to 25,000.

- 'Uncertain' future -

The Alliance for American Manufacturing (AAM) cheered February's factory job gains but cautioned about "a very uncertain future," with Trump recently unveiling a volley of tariffs and threats on allies and adversaries.

AAM's president, Scott Paul, said in a statement that the manufacturing sector had been stalled for 30 months.

He called for a "responsible and orderly application of new tariffs, particularly on China and other countries with persistent unfair trade practices."

On Tuesday, Trump's steep tariffs on major US trading partners Canada and Mexico took effect, roiling markets.

The president has since walked back some of these moves with temporary exclusions for imports covered by a North American trade pact.

Pantheon economists cautioned that "cracks are appearing in the labor market," citing a separate report this week from outplacement and coaching firm Challenger, Gray & Christmas.

While the Challenger report noted tens of thousands of government job cuts, it also flagged significant private sector layoffs, many of them in retail and consumer products industries.

These hint at the impact of "heightened uncertainty around trade policy," said Pantheon Macroeconomics.

ZipRecruiter chief economist Julia Pollak flagged signs of "softening" in the market, with a shortening of the work week and rise in workers "forced into part-time jobs."

This suggests some employers are cutting back on hours even as they avoid layoffs.

Pollak said the US Federal Reserve will "likely welcome signs of a cooling job market, but policymakers will also be watching for signs that the softening is turning into something more serious."

Friday's Labor Department report also showed that wage gains cooled from January to February to 0.3 percent, although compared with a year ago, earnings were still 4.0 percent up.

K.Han--SG