The U.S. job market turned weaker last month, dashing hopes for an economic rebound.
A report from the Labor Department Friday shows employers cut 92,000 jobs in February, when economists had expected the U.S. would continue adding jobs, albeit at a sluggish pace. The unemployment rate inched up to 4.4%.
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Job gains for December and January were also revised downward, with December now showing a net loss 17,000 jobs.
February’s job losses were widespread, with factories, construction companies and the federal government all shedding workers. Even health care, which has been a source of strength in the job market, lost 28,000 jobs in February — partly as a result of a nurses strike.
Policymakers had hoped the job market was stabilizing after anemic hiring in 2025. But February’s job loss suggests continued weakness. That could alter the Federal Reserve’s calculus, as it weighs further cuts in interest rates.
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The weaker than expected jobs report comes as Americans are already anxious about the high cost of living. Those affordability concerns will likely be amplified as the war in Iran has triggered a sharp rise in energy prices. AAA reports the average price of gasoline jumped another 7 cents overnight, to $3.32 a gallon. That’s 21 cents higher than this time last year.
Still, people who are working continue to receive pay raises. Average wages in February were up 3.8% from a year ago.