The labour market had been expected to recover this year after a weak 2025, when the US economy added an average of just 15,000 jobs per month amid lingering effects of high interest rates and the impact of President Donald Trump’s tariff policies.
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Revisions also cut 69,000 jobs from December and January payrolls.Construction companies cut 11,000 jobs last month, which likely reflects frigid weather. And healthcare firms shed 28,000 jobs after a four-week strike by more than 30,000 nurses and other front-line workers at Kaiser Permanente in California and Hawaii.
Employers were reluctant to hire last year because of uncertainty over President Donald Trump’s tariffs – and the unpredictable way he rolled them out.
High interest rates, engineered by the Federal Reserve to combat a burst of inflation following the COVID-19 pandemic, also weighed on the job market in 2025.
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The impact of Trump’s aggressive trade policies may recede in 2025. His import taxes became smaller and less erratic after he reached a trade truce last year with China and deals with leading US trade partners such as Japan and the European Union. A lot of businesses have also learned how to offset the costs of the tariffs, often by passing them along to customers via higher prices.
