Official figures reported that U.S. payrolls declined by 92,000 in February and the unemployment rate increased to 4.4%, contrary to expectations that hiring would remain stable.
Nearly every sector recorded job losses, including healthcare, which was affected by strikes during the month. The Labor Department said federal government employment fell by 10,000 in February and has dropped by 330,000, or 11%, since reaching a peak in October 2024. The department also revised down previously reported job gains for December and January.
The report followed a 2025 slowdown described as the weakest year for job growth since the pandemic. After the data release, Wall Street shares declined. Political reactions split along partisan lines, while the National Economic Council said it still expected strong growth to support job creation.
Analysts noted the Federal Reserve would typically consider cutting borrowing costs in response to labor-market weakness, but warned that a sustained increase in oil prices linked to the US-Israel war in Iran could raise inflation risks and constrain policy options.