151,000 Jobs Added as Federal Workforce Shrinks in Trump’s First Full Month

The US labor market added 151,000 jobs in February, falling short of the 160,000 forecast, according to data released by the Bureau of Labor Statistics on Friday.

The unemployment rate ticked up to 4.1% from January’s 4.0%, suggesting some cooling in employment conditions. February’s job growth exceeded January’s downwardly revised figure of 125,000 positions, previously reported as 143,000.

This marks the first complete monthly assessment of the labor market during Donald Trump’s second presidential term. Average hourly earnings increased 0.3% month-over-month, aligning with economists’ expectations.

Year-over-year wage growth reached 4.0%, slightly below the projected 4.1%. The federal government shed 10,000 jobs last month, likely reflecting initial impacts from the Department of Government Efficiency (DOGE) initiative led by Elon Musk.

This reduction represents early stages of Trump’s promised federal workforce cuts. Healthcare continued its strong performance, leading job creation with 52,000 new positions.

Financial activities contributed 21,000 jobs, while transportation and warehousing added 18,000. Manufacturing rebounded with 10,000 jobs after losses in previous months.

Several sectors struggled in February. Retail trade lost 6,300 jobs, and leisure and hospitality experienced a significant decline of 16,000 positions.

U.S. Labor Market Update

The labor force participation rate dropped to 62.4% from January’s 62.6%, reaching its lowest level in two years. This decline occurred primarily among men.

Economists describe the report as showing a “Goldilocks” scenario despite missing expectations. The labor market remains steady even as businesses navigate uncertainty from shifting trade policies and government workforce reductions.

Market reaction remained subdued following the report. Investors continue to anticipate three Federal Reserve interest rate cuts this year, up from previous expectations of one or two.

The report arrives during a week of market volatility, with the Nasdaq recently entering correction territory after falling over 10% from its mid-December peak. Analysts suggest future reports may show smaller job gains as Trump’s policies begin affecting employment patterns across multiple sectors.