Healthcare sector was hardest hit, while tariff-exposed sectors remain stagnant
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Published March 6, 2026
The U.S. economy unexpectedly lost 92,000 jobs in February, and the unemployment rate rose to 4.4%, marking the sixth contraction in the U.S. job market since Trump took office.
The U.S. Department of Labor released February employment statistics on Friday.
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Economists expected a modest rise, with a Reuters poll of economists at 59,000, Bloomberg News at 55,000 and Dow Jones at 50,000.
The unemployment rate rose slightly by 0.1% from January’s 4.3%, with more than 25% of the unemployed unemployed having been out of work for more than 27 weeks.
The hardest hit sectors
February’s decline followed a downward revision to January’s gain, when the U.S. economy added 126,000 jobs.
The health sector was hardest hit, with 28,000 jobs lost in February. Federal cuts continued, with industry-wide job losses of 10,000 jobs in February. But it was further accentuated by strikes in California, Hawaii, and New York.
The cuts to the health industry came despite ADP’s private payroll report released Thursday showing education and health services added 58,000 jobs. A total of 63,000 jobs were added during the month, according to ADP’s Private Payroll Report.
Industries such as transportation and warehousing continue to be hit hard by the impact of tariffs, with jobs decreasing by 11,000 in the same month. The industry has lost 157,000 jobs since this time last year.
Industries such as construction, wholesale and retail trade, as well as leisure and hospitality industries, remained unchanged from this time last month. The import tariffs were struck down by the U.S. Supreme Court in early February, but President Trump has said he will now impose 10% tariffs worldwide, rising to 15% soon.
Pressure on the Fed
The U.S. central bank will hold its next policy meeting on March 17-18, but economists still expect the Fed to keep the overnight rate in the 3.50-3.75% range. However, the probability of a June interest rate cut has increased after Friday’s data.
The dollar was little changed against a basket of currencies. US bond yields fell.
“Today’s numbers may put the Fed between a rock and a hard place,” Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management, told Reuters.
“A significant deterioration in the labor market would support rate cuts, but the Fed may feel forced to stay on the sidelines given the risk that a prolonged rise in oil prices could trigger another surge in inflation.”
The White House did not respond to Al Jazeera’s request for comment.
The US market has been hurt by the slowdown in the labor market. In midday trading, the Nasdaq was down 0.8%, the S&P 500 was down 1% and the Dow Jones Industrial Average was down 1.1%.
