WASHINGTON—The U.S. economy added 228,000 jobs in March, while the unemployment rate held steady at 4.2%, according to Friday's report from the Labor Department.
However, the announcement comes amid economic uncertainty. Earlier this week, President Trump imposed new tariffs, which could have a significant impact on the economy. While the long-term effects on the U.S. job market remain unclear, the move has already sparked concerns on Wall Street, contributing to a decline in the stock market.
“The unemployment rate in March increased to 4.2% and wage growth slowed to 3.8%. However, payroll growth bounced higher to a 228,000 gain, a pickup from a 117,000 gain in February,” noted Mortgage Bankers Association SVP and Chief Economist Mike Fratantoni. “Job gains from the first two months of the year were revised down by a cumulative 48,000. On net, the overall picture changed little during the time this data was collected – the job market was softening somewhat, but there were no indications of a sudden slowdown.”
Fratantoni noted that most sectors within the economy showed modest job growth.
“Unsurprisingly, given the DOGE headlines, federal government payrolls decreased by 4,000 over the month, with further decreases anticipated,” he said.
Fratantoni addressed the Trump tariffs.
“In light of the tariff announcements this week and the sharp drop in stock markets around the world in response, these data are likely not capturing the moment with respect to the actual strength of the economy,” he said. “However, the Federal Reserve, in data-dependent mode, is likely to remain cautious with respect to any rate cuts so long as inflation is above target, and the job market data continues to come in strong.”
Dawit Kebede, America's Credit Unions senior economist, noted the performance brings the average job gain for the first quarter to 152,000.
"A strong pace of hiring," Kebede said. "The impact of federal workforce cuts appears limited in the report, as employees on paid leave or receiving severance are still counted as employed. Additionally, court rulings have temporarily halted some layoffs. However, the recent escalation of the tariff war and rising recession concerns pose a threat to the labor market’s strength. A healthy labor market is crucial for the stability and success of credit unions' operations.”