US economy loses 92,000 jobs in February

The United States economy recorded a serious setback in February after employers cut about 92,000 jobs, while the unemployment rate rose slightly to 4.4 per cent, according to fresh data released on Friday by the Bureau of Labor Statistics.

The unexpected decline surprised economists who had projected a modest increase of about 60,000 jobs for the month, with the unemployment rate expected to remain unchanged at 4.3 per cent.

The report marks a significant reversal from January’s figures, which had initially suggested stronger hiring. However, January’s job gains were later revised downward to 126,000 from the earlier estimate of 130,000.

December’s labour data was also adjusted, showing a loss of 17,000 jobs instead of the previously estimated gain of 48,000.

Economists said the February figures highlight the fragile state of the US labour market, especially as several sectors recorded notable job losses.

The health care sector, which has accounted for a large share of job growth over the past year, lost about 28,000 positions. Analysts attributed much of this decline to a mid-February strike involving nurses and health care workers at Kaiser Permanente.

ALSO READ:US-Israel strikes: Trump gives conditions for deal with Iran 

Other sectors also recorded reductions in employment. The leisure and hospitality industry lost about 27,000 jobs, while the construction sector shed roughly 11,000 positions during the month.

According to Diane Swonk, chief economist at KPMG US, the report shows how vulnerable the labour market can be when a major employment driver such as the health care sector experiences disruptions.

She noted that the weakness seen in the labour market over the past year has not fully eased.

The latest employment report also comes amid rising economic uncertainty in the United States. Analysts point to several developments in recent weeks, including shifts in trade policy following a ruling by the US Supreme Court, layoffs linked to the growing use of artificial intelligence, and geopolitical tensions in the Middle East that have pushed fuel prices higher.

Weather conditions also played a role in the February numbers. A severe cold wave across several US states early in the month affected economic activity, particularly in industries such as construction, leisure and hospitality.

In addition, the strike by health care workers is expected to distort the data temporarily. Since the industrial action ended on February 23, economists anticipate a one-time rebound in health care employment in March’s report.

The labour market has now recorded job losses in five of the past nine months. Data from the Bureau of Labor Statistics also show that since May, shortly after President Donald Trump announced a new wave of tariffs, the US labour market has recorded a net loss of about 19,000 jobs.

Manufacturing, which many expected would benefit from the tariffs, has also struggled. The sector has lost jobs in 13 of the past 14 months, including another 12,000 positions in February.

Despite the decline in payroll numbers, some indicators suggest that the labour market may not be deteriorating rapidly. Layoffs have not increased significantly and the unemployment rate remains relatively low by historical standards.

There were also positive signs in wage growth. Average hourly earnings rose by 0.4 per cent in February, pushing the annual wage growth rate to 3.8 per cent, which remains higher than the current inflation rate.

Economists also noted a decline in the number of people working part-time for economic reasons, as well as a reduction in the number of discouraged workers.

However, analysts warn that persistent uncertainty surrounding trade policies, inflation and global geopolitical tensions could continue to weigh on business confidence and hiring plans in the coming months.

CNN