The U.S. economy delivered a stronger-than-expected performance in March, adding 228,000 jobs, according to the Labor Department. The job growth exceeded economists’ forecasts, which had predicted around 135,000 new jobs.
Unemployment Rate Ticks Up Slightly
Despite the job growth, the unemployment rate edged up to 4.2% from 4.1% in February. Wage gains remained solid, supported by historically low layoffs, helping to keep the economic expansion on track.
Business Caution Grows Over Tariffs
Economists warn the labor market’s momentum could face challenges in the coming months. President Donald Trump’s recently announced 10% minimum import tariff has sparked concerns across the business sector, raising fears of retaliatory measures and global supply chain disruptions.
Some experts estimate that the new duties have pushed the U.S. effective tariff rate to its highest point in over a century. If trade tensions persist, companies could scale back hiring—or even cut jobs—as prices rise and consumer spending slows.
Short-Term Strength, Long-Term Uncertainty
While March’s job numbers provide short-term relief for volatile markets, analysts caution that underlying economic risks remain. GDP growth estimates for the first quarter are hovering below 0.5%, with some suggesting a possible contraction.
Retail jobs may be the first to take a hit as rising prices force consumers to tighten their budgets. Some economists even say a recession within the next year can’t be ruled out.
What’s Next for the Federal Reserve?
With economic uncertainty building, many analysts expect the Federal Reserve to resume interest rate cuts by June. The Fed had paused its easing cycle in January but signaled two rate cuts might be needed this year to support growth.
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