US job growth exceeded expectations in March and the unemployment rate fell, providing some relief to President Donald Trump as the economy comes under increasing pressure from the war in Iran and rising oil prices.
The Labor Department reported Friday that companies added a net 178,000 jobs last month, a big jump from February, when the economy actually lost jobs. But it was broadly in line with January — a sharp fluctuation that makes it difficult to assess the health of the job market. But the overall positive trend suggests that the economy remained resilient during the first quarter of the year.
Guy Berger, a senior fellow at the Burning Glass Institute, called it an “incredibly zig-zagging employment situation.” He added, “You have to average out all these jobs reports. But the average looks pretty good.”
January’s figures were revised up to add 160,000 jobs versus the previously reported 126,000, while February’s figures were revised down to 133,000 lost versus the 92,000 initially reported.
None of these figures are likely to change the narrative that has prevailed over the past few years of a low-rent, low-fire labor market. But the unemployment rate now stands at 4.3 percent, and the manufacturing sector — long weak — added 15,000 jobs in March, the highest number since November 2023.
That gives Trump some useful talking points as polling shows deep dissatisfaction with the state of the economy, especially in the wake of the war in the Middle East, which has led to rising gas prices. Despite Trump’s efforts to boost the sector through tariffs, manufacturers have cut jobs over the past year, although activity has been expanding in recent months.
White House trade adviser Peter Navarro said the jobs report was “not a picture of the past economy.”
“This is a picture of an economy that still has productive strength, despite months of media warnings about tariffs, inflation and an impending recession,” he said. “Remember here that February’s figures were relatively weak. But a large part of that weakness was always likely to prove temporary, driven by weather distortions and strike effects. March confirmed exactly that, with hiring rebounding sharply as the temporary disruptions eased.”
A downside for Trump is that the good news on jobs is likely to reinforce Federal Reserve Chairman Jerome Powell’s stance of keeping interest rates steady while the central bank assesses the potential fallout from the Iran conflict, which could raise inflation and slow growth. The president has called on Powell to lower rates “immediately.”
“The market is pricing in a 76 percent chance that the (Fed’s policy) rate remains in its current range at the end of 2026, with small risks to both a higher and lower Fed funds rate later this year,” PNC chief economist Gus Faucher said in a note on the report.
