As trade conditions deteriorated, job creation did not abate in February. Here are the five things we learned from U.S. economic data released during the week ending April 4.
Payroll growth accelerated in March. Nonfarm payrolls expanded by a seasonally adjusted 228,000, above the 111,000 and 117,000 jobs added in January and February. The latter data reflected downward Bureau of Labor Statistics revisions of 117,000. Private sector payrolls grew by 209,000, with 197,000 in the service sector. Industries with the largest payroll gains were health care/social assistance (+77,800), leisure/hospitality (+43,000), retail (+23,700), and transportation/warehousing (+22,900). Average weekly earnings of $1,231.20 represented a 3.2 percent increase from a year earlier.
Based on a separate household survey, the unemployment rate edged up 1/10th of a percentage point to 4.2 percent. The labor force expanded by 232,000, with the labor force participation rate adding 1/10th of a percentage point to 62.5 percent. The 25-54 participation rate shed 2/10ths of a percentage point to 83.3. The median length of unemployment narrowed by 2/10ths of a percentage point to 9.8 weeks, while the number of part-time workers seeking a full-time opportunity declined by 157,000 to 4.780 million. The broadest measure of labor underutilization (the U-6 series) decreased by 1/10th of a percentage point to 7.9 percent.
There were fewer unfilled jobs in February. The Bureau of Labor Statistics reports there were a seasonally adjusted 7.568 million open jobs, down 194,000 for the month and 10.4 percent from a year earlier. The private sector had 6.667 million open jobs, including a million available opportunities in health care/social assistance, professional/business services, and trade/transportation/utilities. Also, there were 482,000 unfilled manufacturing jobs. Employers hired 5.396 million workers (+25,000 versus January 2025 and -4.7 percent versus February 2024), with 5.046 million in the private sector. Trade/transportation/utilities and professional/business services employers hired at least a million workers. 5.261 million people separated from their jobs, down 11,000 from January 2025 and 3.9 percent from a year earlier. This included 3.195 million workers quitting their jobs (-61,000 versus January 2025) and 1.790 million suffering a layoff (+116,000 versus January 2025).
Manufacturing contracted in March. The Manufacturing PMI lost 1.3 points to 49.0, following two consecutive above-50 monthly readings for the Institute for Supply Management measure. (A reading above 50 indicates an expanding manufacturing sector, while a reading above 42.3 signals an expanding U.S. economy). Falling were index components for new orders (45.2), production (48.3), and employment (44.7). The inventories index (53.4) improved. Nine industries reported growing during the month, led by textiles, petroleum/coal products, and fabricated metal products. The press release noted, “Price growth accelerated due to tariffs, causing new order placement backlogs, supplier delivery slowdowns, and manufacturing inventory growth.”
The service sector expanded again in March. The ISM’s Services PMI lost 2.7 points to 50.8. Even with the decline, the Service PMI remained above 50.0—the demarcation between an expanding and shrinking service sector—for nine months. While the business activity/production index component increased (55.9), those for new orders (50.4), employment (46.2), and supplier deliveries (50.6) declined. Ten service sector industries reported growth, led by accommodation/food services, transportation/warehousing, and finance/insurance. The press release noted “a close balance in near-term sentiment, between panelists with good outlooks and those seeing or expecting declines.”
The trade deficit remained wide in February as companies imported goods before the tariffs hit. Exports grew 2.9 percent to a seasonally adjusted $278.5 billion, whereas imports remained bloated at $401.1 billion. The resulting trade deficit of -$122.7 billion was 6.1 percent below January’s. The Census Bureau and Bureau of Economic Analysis measure over the first two months of 2025 was up 86.0 percent from last year. The goods deficit declined $88 billion to -$147.0 billion and goods services narrowed by $0.8 billion to +$24.3 billion. The latter reflected lower exports of finished metal shapes and nonmonetary gold and increased imports of consumer goods and capital goods. The U.S. had its largest goods deficits with the European Union, China, and Mexico.
Other U.S. economic data released over the past week:
- Jobless Claims (Week ending March 29, 2025, First-Time Claims, seasonally adjusted): 219,000, -6,000 vs. the previous week, +4,000 vs. the same week a year earlier). 4-week moving average: 223,000 (+3.4% vs. the same week a year earlier).
- Factory Orders (February 2025, New Orders for Manufactured Goods, seasonally adjusted): $594.0 billion (+0.6% vs. January 2025; -0.3% vs. February 2024.)
- Vehicle Sales (March 2025, Automobiles and Light Truck Sales, seasonally adjusted annualized rate): 17.767 million (+11.0% vs. February 2025; +13.3% vs. March 2024).
- Construction Spending (February 2025, Value of Construction Put in Place, seasonally adjusted annualized rate): $2.196 trillion (+0.7% vs. January 2025; +2.9% vs. February 2024).
- Agricultural Prices (February 2025, Prices Received by Farmers, not seasonally adjusted): +13.5% vs. January 2025; +22.1% vs. February 2024.
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What We Learned About the U.S. Economy Last Week 