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The United States economy added more jobs than expected in March, according to data released Friday by the Labor Department, though analysts urged caution about the sustainability of the growth.
The world’s largest economy created 178,000 jobs in March, rebounding from a loss of 133,000 jobs in February. The unemployment rate also declined slightly by 0.1 percentage points to 4.3 percent.
The figures exceeded analysts’ expectations. Economists surveyed by Dow Jones Newswires and The Wall Street Journal had projected job gains of about 59,000.
While the report showed stronger-than-expected growth, economists said several temporary factors may have contributed to the increase.
Nancy Vanden Houten, lead US economist at Oxford Economics, said the figures likely reflect short-term effects such as the end of strike actions, seasonal factors and a rebound after harsh winter weather.
The data was stronger than forecast, “but likely overstates the sustainable pace of job growth,” she said.
“The end of a strike, seasonal quirks and a rebound after harsh winter weather likely boosted job growth in some sectors,”
US President Donald Trump welcomed the report, describing it as evidence of the strength of his economic policies.
“My Economic Policies have created an enormously powerful engine of Economic Growth, and nothing can slow it down,” Trump wrote on his Truth Social platform.
A White House spokesperson also said the US economy would continue to strengthen once the “short-term disruptions” linked to the US-Israel war on Iran ease, “America’s economic resurgence is set to only accelerate.”
Much of the March job growth came from the healthcare sector, which added 76,000 jobs after losses the previous month partly linked to strikes.
Employment in the construction sector also rose by 26,000 jobs, although the Labour Department noted that employment levels in the industry have changed little compared with a year earlier.
Meanwhile, national government employment declined, falling 11.8 percent since October 2024, amid efforts by the Trump administration to reduce government spending and cut the size of the federal workforce.
The Labor Department also revised employment figures for January and February, showing that job gains during those months were 7,000 lower than previously reported.
Analysts said the broader economic outlook remains uncertain as the war involving the United States, Israel and Iran has pushed up global oil prices and disrupted supply chains, raising concerns about a potential slowdown.
Nationwide Chief Economist Kathy Bostjancic said the labor market remains in “good standing,” with broad-based gains across the private sector.
However, Vanden Houten said the report “doesn’t change our assessment that the downside risks to the labor market have increased” due to the war.
“As the labor market softens due to the fallout from the war, we expect the unemployment rate to edge up,” she said.
Economists also noted that the labour market continues to operate in a “low-hire, low-fire” environment, where hiring remains modest but layoffs are also limited.
“If you look through the noise you have, you know that same picture that we’ve been looking at, which is a labor market that’s holding up, but that has become more fragile, and that remains stuck in this low-hire, low-fire type of environment,” EY-Parthenon Senior Economist Lydia Boussour told AFP.
The uncertainty surrounding the economic impact of the conflict has led policymakers at the Federal Reserve to adopt a cautious approach to interest rate decisions as they balance concerns over inflation and employment.
Although unemployment has remained relatively stable, analysts say the figures partly reflect a decline in labor supply, which some attribute to stricter immigration policies under the Trump administration.
Federal Reserve officials have signaled that inflation remains a key concern, even as they monitor potential signs of weakness in the labour market.
“We are getting mixed signals, with some key indicators showing signs of steadying while others are suggesting a weakening labor market,” New York Fed President John Williams said Monday.
Economists say the March jobs report may give policymakers “a little bit of reassurance and a little bit of breathing room” to focus on “the inflation side of their mandate in the coming months.”
