Total nonfarm payroll rose by 228,000 in March and unemployment inched up to 4.2%, according to a U.S. Bureau of Labor Statistics report released April 4 — one that economists are largely calling the calm before the storm.
“The upside surprise in job growth is already out of date,” Mischa Fisher, economist at Udemy, said in a statement. A number of industries saw flat growth in March, including information, finance, manufacturing and professional and business services. “And that’s before the tariff announcements,” Fisher said.
Real-time data from ManpowerGroup also indicated declines in job postings, particularly new postings since the prior month. “At the surface level, it seems like a stable and resilient labor market,” Ger Doyle, U.S. country manager at ManpowerGroup said in a statement. “However, a closer examination of the data reveals that employers are exercising caution across nearly all sectors.”
Additionally, federal employment only fell by 4,000 in March, according to BLS, but that doesn’t include workers who took the delayed severance offer, as they are still counted as employed.
The big story leading into April, however, is the Trump administration’s “Liberation Day” tariffs and policy changes that will inevitably affect U.S. business decisions in coming weeks.
“The residual confidence and optimism that helped buoy the labor market through the first quarter reversed virtually overnight after this week’s announcements, and there is likely no going back,” Cory Stahle, Indeed Hiring Lab economist, said in a statement. “The velocity with which these policy changes are now happening is so fast that many employers will find it challenging to find the stability needed to maintain business as usual.”
With unprecedented uncertainty — signaled by a startling drop in the stock market not seen since the pandemic’s onset — employers and the labor market may be “locked in place,” Doyle said. While businesses are largely focused on preserving the status quo for now, that could change if uncertainty continues, putting layoffs back on the table, Doyle noted.
