• Prior -92K (revised to -133K)
• Two-month net revision -7K
• January was +126K (revised to +160K). December was -141K
• Unemployment rate 4.3% vs 4.4% expected.
• Prior unemployment rate 4.4%.
• Unrounded unemployment 4.256%% vs 4.441% prior
• Participation rate 61.9% vs 62.0% prior
• U6 underemployment rate 8.0% vs 7.9% prior
• Average hourly earnings +0.2% m/m vs +0.3% expected
• Average hourly earnings +3.5% y/y vs +3.7% expected
• Average weekly hours 34.2 vs 34.3 expected
• Change in private payrolls +186K vs +70K expected
• Change in manufacturing payrolls +15K vs -5K expected
• Government payrolls -8K vs -6K in February

Sectors:

• Health care: +76K vs -28K prior
• Construction: +26K vs -13K prior (revised from -11K)
• Social assistance: +14K vs +9K prior (revised to +5K)
• Financial activities: -15K vs +2K prior (revised from 0K)
• Transportation and warehousing: +21K vs -49K prior (revised from -11K)
• Professional and business services: +2K vs +7K prior (revised from 0K)

There is plenty of good news in this report for the Fed and it should shut the door on rate-cut talk for a bit, if it wasn’t already closed by the war. Not only are jobs strong but the unemployment rate fell and wage numbers improved. That’s goldilocks stuff.

The one caveat is the ongoing fall in labor force participation. Some of that is demographic but if it had stayed steady at 62.5% (where it was in November) then unemployment would be at 4.9%.

For background, the US nonfarm payrolls report, published monthly by the Bureau of Labor Statistics, is one of the most closely watched economic indicators in the world. It measures the net change in the number of employed people across nearly all sectors of the economy, excluding farm workers, private household employees, and nonprofit organization employees. The report, formally known as the Employment Situation, draws on two surveys: the establishment survey, which produces the payrolls figure from a sample of roughly 119,000 businesses, and the household survey, which generates the unemployment rate from interviews with about 60,000 households.

The labor market entered 2026 in a weakened state. A major benchmark revision released with the January report revealed that 2025 job growth had been significantly overstated, with the full-year gain revised down from roughly 584,000 to just 181,000 — an average of about 15,000 jobs per month. Federal government employment has been a persistent drag, declining by approximately 330,000, or 11 percent, since peaking in October 2024 as the administration pursued workforce reductions.

February’s report showed the economy shedding 92,000 jobs, the third decline in five months and well below expectations of a roughly 59,000 gain. A Kaiser Permanente strike sidelined over 30,000 healthcare workers, and severe winter weather weighed on construction and other sectors. The unemployment rate ticked up to 4.4 percent from 4.3 percent in January. On the positive side, wages continued to grow, with average hourly earnings rising 0.4 percent for the month and 3.8 percent year-over-year, both slightly above forecasts.