The US added 151,000 jobs in the latest report, slightly below the expected 160,000. Economists at CIBC noted that trade policy uncertainty did not seem to affect the job market in February.
However, they anticipate challenges in the coming months due to the recent layoff of 75,000 federal workers and cautious hiring by trade-exposed businesses. They suggested that poor winter weather might have impacted some hiring, with a recovery anticipated soon.
Layoffs In Leisure And Hospitality
Layoffs in leisure and hospitality have been observed, potentially linked to immigration policy changes. A decrease in border crossings may affect employment in this sector.
Participation in the workforce declined by 0.2 percentage points, raising concerns about weak population growth and its effect on wages. Wage growth appears to be increasing in sectors like leisure, hospitality, wholesale trade, and non-durable goods manufacturing.
Overall, while the US economy remains stable, recent policy uncertainty could gradually influence future data. The higher tariffs on China are expected to push prices upward, indicating potential challenges for the Federal Reserve ahead. Upcoming data releases include JOLTS, CPI, and consumer sentiment.
February’s employment report fell just short of expectations, with 151,000 new positions added against the forecast of 160,000. While the difference is small, it feeds into a broader discussion about whether changing trade conditions and policy decisions are beginning to influence hiring trends. Analysts at CIBC remarked that the uncertainty surrounding trade policy had not yet made a visible dent in labour market figures. That said, their outlook suggests caution.
In the weeks ahead, complications could arise. The recent dismissal of 75,000 government employees adds pressure to a labour market that is already adjusting to more restrained hiring practices in industries connected to international commerce. Jobs reliant on foreign trade might see increases in employer hesitation, particularly if shifting tariff policies cause firms to delay expansion plans. The possibility that adverse weather affected employment figures last month also warrants attention, though a rebound is expected as seasonal factors normalise.
Meanwhile, cracks are beginning to appear in leisure and hospitality employment. Layoffs in this sector could be tied to changes in immigration regulations, with adjusted border policies leading to fewer arrivals that otherwise might contribute to demand. If this trend continues, it may add another layer of difficulty for businesses reliant on steady consumer activity.
The workforce participation rate dipped by 0.2 percentage points, bringing renewed attention to one of the economy’s underlying pressures. A slowing population growth rate is beginning to make an impact, and fewer people engaging in the labour force raises longer-term concerns about wage dynamics. Despite this, pay increases are still visible in certain industries, including wholesale trade and non-durable goods manufacturing. These areas might provide some insight into where wage pressures are emerging most clearly.
Upcoming Economic Data
At present, economic conditions remain steady, though ongoing policy adjustments have the potential to show their effects in upcoming reports. Tariffs on Chinese imports are expected to raise costs, which could eventually influence inflation readings and, in turn, shift expectations regarding the Federal Reserve’s next steps. Key reports in the near term include the latest figures on job openings, inflation, and consumer confidence, all of which will provide further direction on whether or not concerns flagged in February’s report begin to materialise more clearly in the data.
