Labor Market Rebounds in March with Strong Job Gains
The U.S. labor market bounced back in March, delivering stronger-than-expected job growth across several key sectors, even as signs of economic stress began to emerge due to aggressive trade and fiscal policy shifts.
While the unemployment rate ticked up, economists point to increased labor force participation as a key reason—not widespread job losses. Yet concerns are mounting around additional federal layoffs and a wave of new import tariffs that could ripple through supply chains in Q2.
Despite the uptick in job creation, volatility remains high. Economists warn of a potential labor market slowdown later in the year as tariffs raise prices and reduce hiring appetite across manufacturing, retail and export-heavy sectors.
The Numbers*:
The U.S. economy added 228,000 jobs in March, well above expectations.
The unemployment rate increased slightly to 4.2%.
There were 8.76M open jobs, which reflects continued demand, though slightly down from 2024 highs.
The labor force participation rate increased to 62.5%.
The number of job quits in the U.S. remained the same at 3.3 million, indicating moderate job-switching behavior.
- Average hourly earnings rose by 0.3% to $36.00.
- Average weekly hours worked were unchanged from February at 34.2 hours.
- Total hires were 5.5M, while total separations were 5.2M.
- Within separations, layoffs/discharges accounted for 1.5 million; most separations are still voluntary (quits).
Industry Trends:
| Industry | February Jobs | Notes |
| Healthcare | + 54,000 | Gains in ambulatory, hospital, and long-term care |
| Leisure & Hospitality | + 43,000 | Hiring rebound after prior month decline |
| Retail Trade | + 24,000 | Includes return of striking workers in food/beverage |
| Social Assistance | + 24,000 | Driven by family and individual service programs |
| Transportation & Warehousing | + 23,000 | Boost from e-commerce delivery and trucking |
| Federal Government | - 4,000 | Impact of DOGE-led layoffs beginning to register |
| Information | - 2,000 | Minor decline: trend remains flat YoY |
The change in total payroll employment for January was revised down by 14,000, from +125,000 to +111,000, and the change for February was revised down by 34,000, from +151,000 to +117,000.
Get latest Jobs Report:
* Above represents March 2025 Data
Sources:
